How to avoid headaches -- and extra fees -- when transferring credit card balances
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The last thing a person who is trying to minimize their credit card costs needs is a $29 late fee and a penalty rate.

The new card company may send a notice saying the balance transfer is complete. Be sure to call the old card company and verify this. Write down the name of the person you talked to, the date, the time and what was said.

To avoid any mix-ups, experts urge people to wait until the old credit card company sends them a billing statement with a zero balance. If the company doesn't send one, request it.

Next step: Cancel the old card. How come? First off, plenty of people out there have trouble avoiding the temptation of an open credit line.

When too much credit hurts
Second, too many open lines of credit can affect a person's ability to qualify for a mortgage or a car loan.

Experts also urge people to focus on paying down the transferred balance, ideally before the teaser rate expires. At the very least, people should continue to pay the minimum payment they were making on the old card or more if they can afford it.

Too often, people take one look at the lower minimum monthly payment owed on their new card and send that in -- which barely chips away at the balance. And sometimes people see the lower payment as a signal to charge even more.

"When people look at the monthly payment on a new credit card and it's $20 less than it was, they say, 'Hey, I can afford to charge more,' " says Kerry Clark, manager of branch services at Consumer Credit Counseling Service in Atlanta. "And then they get slammed six months later."

The balance grows and the teaser rate expires and they end up with more debt and higher minimum monthly payments then they had with the old card.

People transferring balances to cards with different rates for balance transfers and new purchases may also want to think twice about running up a lot of new purchases on that card.

"The bank will usually apply payments to the lower rate balance first, thereby allowing you to run a lot of interest debt at a higher rate," says Linda Sherry, editorial director of Consumer Action, a consumer advocacy organization in San Francisco.

This tactic allows card issuers to maximize the interest they collect.

Say a person transfers a $2,000 balance onto a new card with a 3.9 rate for balance transfers and 17 percent APR for new purchases. The cardholder then charges a $45 dinner with the card. The $2,000 must be paid in its entirety before any payment is directed to that restaurant bill -- so the price of that dinner keeps climbing with each passing month.

Find one card and stick with it
Consumer experts also urge people who transfer balances to a low-rate card to stick around for awhile.

"Jumping from card to card can really hurt you. You're moving too fast to establish credit," says Kidwell. "You need to pick one and stay with it. Plan to stay a year or more. You're actually damaging your credit because you're not building a credit history."

Not only is it tough to qualify for low rate credit cards, holding on to those rates is harder than ever. It's no longer enough to be an on-time payer on that low-rate card. Cardholders need to keep their entire credit profile clean.

In an offer from Capital One, it reserves the right to change the terms of the account if the Capital One account is not in good standing "or if you do not maintain good standing with other credit accounts and excellent performance with credit bureaus."

On an offer for 7.99 fixed rate, Providian writes, "If you do not comply with the terms of the account; for example, if your payments are late or if you significantly increase your total debt, your rates may increase."

And once a card company finds a blemish on that credit profile, be prepared for a rate hike.

"If you go delinquent in one card. They've got you. They know you can't transfer that balance to another card so they bounce you to a higher rate," Dvorkin said. "These companies are looking for an excuse to charge you more. They're looking for revenue ... If you don't have perfect credit they're going to take advantage of you."