Transfer a balance
How do I transfer a balance?
Before you transfer that hefty credit
card balance to a card with a super-low introductory rate, read
the fine print and ask questions. Otherwise, you could end up paying
fees and a much higher interest rate than you expected.
First, ask these questions:
1. How long does the introductory rate last?
2. What is the card's annual percentage rate after that teaser rate
3. Does the teaser rate apply to transferred balances or new purchases
4. Does that card have an annual fee?
5. What about late fees and over-the-limit fees?
6. Ask if there are balance-transfer fees (Some issuers charge transaction
fees as high as 4 percent. So the higher that balance, the higher
the transaction fee. A 4 percent fee on a $5,000 balance would cost
Read through the credit
card offer a few times. A lot of the information is hard to
decipher. For example, some offers waives fees for "initial
balance transfers" only. These are the transfers that are authorized
when the customer accepts the card and completes the balance transfer
In such cases, every other balance transfer is treated as a cash
advance and is subject to cash advance fees.
Keep in mind that not everyone who gets an offer qualifies for
the super-low rate. While an offer may boast a 3.9 percent teaser
rate that bumps up to 17 percent after six months, a person may
qualify for a card with 7.9 percent teaser and a regular annual
percentage rate of 21 percent.
Also realize that it may only take one slip-up for that
super-low rate to disappear. For example, a Platinum MasterCard
from Fleet with a 9.99 APR jumps to 21.99 percent after one tardy
payment. And if you fall behind on payments on another card, your
new card may raise your rate.
Once comfortable with the terms of the offer, be sure to fill out
the balance transfer form carefully. Incomplete information may
halt or delay a transfer.
It's also a good idea to make the minimum payment on the old card
while waiting for the balance transfer to take effect -- which may
take anywhere from two to four weeks.
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.
Then cancel the old card - you don't need it.
Use this step-by-step
worksheet as a guide for transferring balances
between credit cards.