How To Do a Credit Card Balance Transfer in 8 Steps

Comparing Cards
  Existing Card: 20% APR New Card: 0% Balance Transfer APR for 12 Months
Balance $5,000 $5,000
Balance Transfer Fee N/A 3% ($5 minimum)
Debt Repayment Time 12 months 12 months
Total Interest $1,000 $150
Total Amount Repaid $6,000 $5,150 ($850 savings)

To transfer debt to a card you own, skip to Step 5 below .

step 3 : revue Balance Transfer Card offer Terms

many balance transfer card offers are available, therefore focus on cards that fit your fiscal needs. Pay cheeseparing attention to the follow terms :

Length of zero-interest deal : Most range between 12 and 21 months, but watch for promotions spanning longer periods, which give supernumerary clock for transfer debt reduction and cutting the come you need to pay monthly .

Balance transfer fee : Some cards don ’ deoxythymidine monophosphate appoint a balance remove fee, but most cards do, typically 3 % to 5 % of the transfer total or $ 5 to $ 10, whichever is greater. Seek low-fee cards, and figure out each menu ‘s fees .

To calculate likely poise transfer fees, follow this convention : sum come you want to transfer x counterweight transportation fee amount ( % written as a decimal fraction ) = total fee. For model : $ 2,500 transfer adam 0.03 ( 3 % fee ) = $ 75 fee. Transfer deadlines : To qualify for the introductory APR deal or deduction on any transmit tip, a quick balance wheel transfer may be necessary. To enjoy the entire interest-free period, originate balance transfers right away .

Credit score requirements : If the card you want requires excellent citation but your credit score falls in the “ fairly ” range, your lotion probably won ’ deoxythymidine monophosphate be approved. If approved, your credit restrict may be besides low for your balance transfer goals. Focus on cards compatible with your accredit visibility .

step 4 : Analyze Your top Picks

Compare cards by calculating how much you ’ ll pay monthly to clear the transfer poise before the promotional APR period ends :

Take the total measure of debt you ’ ll transfer to the card and add the balance transfer fee to it. This is the total balance transfer cost .

Example : $ 5,000 debt + $ 150 fee = $ 5,150 balance transmit sum cost

future, divide the full balance transplant price by the 0 % balance transfer APR crack length in months. That gives you the minimum measure you ’ ll need to pay each calendar month to eliminate the transfer debt interest-free .

Example : $ 5,150 / 12 months = $ 429.16 minimum monthly payment

If the minimum monthly payment is besides high for your budget, find another poster with a longer introductory APR offer to spread out and reduce the monthly requital .

If you don ’ triiodothyronine pay down the poise on clock time, you ’ ll pay the standard symmetry transfer interest rate on the remaining counterweight.

footfall 5 : apply for the New Card

This is the easiest depart. An on-line credit menu application requires only a few clicks. You ’ ll need your Social Security number, address, employment, income information, and possibly credit-related history for identity confirmation. not approved immediately ? Don ’ t sweat it. The issuing bank may just need more time. Wait for mailed information before applying for another circuit board .

footfall 6 : Gather information

Get ready for the balance transfer to your new card. If you ’ ra transferring debt from multiple accounts, you ’ ll motivation to collect details for each account :

  • The account number for each account you are transferring debt from.
  • The exact amount(s) of debt you’ll be transferring to the new card.

dance step 7 : Request a Balance transfer

Request a balance wheel transfer on-line or by telephone. Start the process by contacting your new poster ’ s customer service department, tell them you ’ d like to start a proportion transfer, and share the data from Step 6 .

The modern wag issuer will contact your old calling card ’ mho issuer and move the balance sum you specified. Be patient. The transfer process may take anywhere from a few business days to a few weeks for modern tease accounts .

If you ’ re consolidating debt from multiple cards, recur this measure for each transfer balance, prioritizing the transfers from cards with the highest interest rates .

step 8 : Make a design To Pay Down the Transferred Debt

You ’ re using a 0 % APR poster to cut interest costs and get rid of debt, so if you don ’ t pay down your libra transfer before the basic rate offer ends, the cost-saving prize of the transfer may be lost .

Tips to keep you on track with proportion transfer repayment :

  1. Create or update your budget: Ensure that your monthly budget includes the minimum payment needed to pay off the balance on time.
  2. Track your spending: Build a custom spreadsheet wizard, use credit and debit accounts offer spending analysis, or download apps like Mint or Wally. 
  3. Reduce or eliminate extra expenses: Dedicate dollars to debt repayment by cutting unnecessary costs. Trim here and there and the dollars add up.
  4. Paid off your debt? Continue spending cautiously: After paying off your balance transfer card, continue budgeting and tracking your spending to avoid future debt. 

That ’ s It !

balance transfers are a utilitarian recognition circuit board have that can save you adult dollars in interest costs, over time .

now that you know how to do a proportion transfer, check out which cards The Balance has deemed best for balance transfers .

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Category : Finance

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