If you carry a high balance on credit cards, transferring those balances to a credit card that offers 0% interest for a promotional period can be a smart way to save money on interest.
The best balance transfer cards offer introductory 0% APR periods on transferred debt that are anywhere from 12 to 21 months long. Pay off your transferred balance before the intro APR expires and you could save a lot of money in interest.
Also read: Understanding the Timeline for Balance Transfers
Low introductory rate
If you have large balances on credit cards, a balance transfer card can save you money on interest by transferring them to a card that has a low introductory rate. These cards are a great way to get rid of debt, and they typically have long intro 0% APR promotional periods that last for up to 21 months.
However, there are a few things to know before you apply for a balance transfer card. You must pay attention to the rules for each credit card, and you should be sure to read the card’s full terms and conditions. Often, issuers include this information in their marketing materials, but you can also check with a standardized disclosure form like the Schumer Box to make sure that the details are correct.
In most cases, you need to call the new card’s customer service to make the transfer and provide them with your account number and the balance from your old credit card. The new card issuer will then process the transfer and you will get your balance transferred to your new card.
You should continue to make the minimum payment on your old card until it has been transferred to your new one, so that you don’t incur a late fee or other penalties. Once the debt has been transferred, you should be able to see your balance on your new card’s online banking page.
No annual fee
A balance transfer credit card is a great way to lower your interest rate on existing debt. However, it’s important to choose the right one for your situation.
The best balance transfer cards offer long introductory offers that allow you to pay down your debt without paying interest. Often, they also come with no annual fee.
To find the best balance transfer credit card, consider a few factors, including the length of the introductory APR period, the regular variable APR after the intro period ends and the issuer’s satisfaction ratings from U.S. News.
Introductory APRs can vary widely, so make sure to read the terms and conditions carefully before you apply. Ideally, the low end of the range should be no more than a few percentage points above your current interest rate and the high end should be no more than 26%.
Depending on the card, you may also be able to earn rewards for purchases made with the new card, such as cash back. Some cards, such as the Chase Freedom Flex(sm), offer 5% cash back on categories that rotate quarterly (requires activation).
You can also get additional benefits by paying your bill with the new card, such as cellphone protection or a free credit report. Those extras can help you keep track of your spending and avoid overspending, which can lower your overall credit score.
Convenience
The best balance transfer cards offer a low introductory rate to help you save money on interest charges. These cards also allow you to transfer your existing balances and pay them off quickly, making them a great choice for reducing credit card debt.
However, it’s important to make sure that you don’t use the balance transfer card for new purchases while the 0% intro APR is in effect or else you might end up losing out on the savings. It’s also a good idea to pay your transferred balance in full before the introductory period ends. Otherwise, the balance could be re-introduced to your account at an ongoing APR and you’ll end up paying more in interest over time.
If you don’t have the discipline to pay off your debt before the introductory APR ends, you may be wasting your money on a balance transfer card and could be better off getting a debt consolidation loan or another type of credit card. But if you’re serious about eliminating your debt and want to save on interest, the Chase balance transfer card might be the right option for you.
It’s important to remember that not all balance transfer credit cards are created equal, so it’s important to shop around for the best deal. This can mean comparing the length of the introductory period and any balance transfer fees, as well as checking to see if the card offers any perks or rewards.
Rewards
A balance transfer credit card is a good choice for those with debt who are looking to pay off their existing balances while taking advantage of a low introductory rate. 0% introductory APR periods range from six months to more than a year, allowing you to save on interest charges while paying down your debt.
In addition to a 0% introductory APR period, these cards typically offer a variety of benefits that can help you get out of debt more quickly. They also often come with helpful features like credit monitoring and tools to help you keep track of your spending.
Several of Chase’s credit cards feature a 0% introductory APR on balance transfers, including the Chase Freedom Flex(sm) and the Chase Freedom Unlimited(r). These cards also provide 5% cash back on purchases at supermarkets (including grocery stores), drugstores and on dining out, plus 3% on all other purchases.
However, a number of these cards charge a balance transfer fee. While these fees are generally lower than the 3% to 5% balance transfer fees charged by many other cards, they could still add up to a significant amount of money.
While a 0% introductory APR is a great way to save money on interest charges, you should be careful about how you use your new card. You should only make purchases that you can afford to pay off in full within the introductory period, and you shouldn’t open additional lines of credit unless you can pay them off in full at the end of the promotional period.
If you’re looking for a balance transfer card that offers ongoing rewards, consider the Chase Freedom Flex(sm). It earns 5% cash back on up to $1,500 in categories that rotate quarterly and on travel booked through Chase Ultimate Rewards. The 5% isn’t as high as the 6% offered by some other cards, but it’s an excellent deal for those who spend a lot on travel and other rewards.