What to do when your balance transfer is denied

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Transferring a balance from a high-interest credit card to one with an introductory zero percent interest rate can make it easier to pay off your debt.

However, there’s no guarantee that the transfer will go through. It can be unsettling to have your balance transfer denied after applying for a new balance transfer credit card. But there are many ways to bounce back. You can contact the issuer directly, work on improving your credit or try an alternative method of debt payoff.

Use this guide to help understand why your balance transfer was denied and begin navigating the next steps.

What you need to know

Balance transfers help people get out of debt because many rewards credit cards offer introductory periods with zero percent interest, which enables you to put your payments toward the principal balance owed instead of interest charges. When looking for a balance transfer option, search for a card that has a zero percent interest period that works with your payoff timeline. These periods usually range between 12 and 20 months.

Also, watch out for a balance transfer fee, which is usually around 3 percent of the total transfer. Depending on how much debt you’re carrying, a high balance transfer fee may not fully offset your interest savings in the long run. Be sure to weigh your interest savings against the cost of completing the balance transfer to ensure it’s the right choice for you.

Typically, balance transfers are easiest to score if your credit is good or excellent, or typically above 670. A solid credit score reassures the issuer that you’re likely to pay off the balance in full. However, a balance transfer isn’t much help if your request is denied. Credit companies may refuse a balance transfer application for several reasons.

Why are balance transfers rejected?

There are two ways in which a card issuer can deny a balance transfer. You can apply for a new balance transfer credit card and not have your application approved, or you can request a balance transfer on an already-approved card but have the transfer declined.

Here’s a breakdown of the reasons either of these scenarios might happen to you:

The issuer rejects your card application

  • Your credit score is too low. Most issuers require a good to excellent credit score (typically above 670) to consider you a suitable applicant for a balance transfer card. A good credit score shows you’re a low-risk candidate who is likely to pay off their complete balance.
  • You have too many recent balance transfers. A series of recent balance transfers on your credit report could indicate that you’re shuffling your money around rather than actively paying it off. This may be a red flag for issuers, so you should avoid requesting too many transfers within a short period.

You’re approved for the card, but denied a balance transfer

  • Your credit limit is too low. A credit limit is the amount of money you can charge to your card at one time. The bank will hold your request for the time it takes the bank to confirm the amount to transfer versus your credit limit. If this limit is lower than the amount of money you requested to transfer from another card, they will likely reject the request. You’re likely to have more success resubmitting your request at a lower amount. Even if you’re only able to transfer a portion of your balance, that can help bring down your interest owed.
  • You waited too long. Most balance transfer cards have a short amount of time from the account opening when you can request a balance transfer. Often, this is around three months after opening. Make sure to read the fine print before applying for a card so you know how long you have to make a balance transfer request.
  • You’re attempting to transfer from the same issuer. If you attempt to transfer a balance from one card to another from the same card issuer, your balance transfer will likely be denied. Many issuers have restrictions on transferring balances between their accounts.

What to do next

Your balance transfer was declined. Now what? There are several steps you can take to increase your future chances of approval. It might not happen overnight, but even small steps today can make a significant impact in a few short months.

Find out why you were denied

Ask the issuer why they rejected your request, whether for the card itself or just the transfer. You may be able to provide further information to help you successfully complete your balance transfer. But even if you can’t fix it immediately, you’ll know what steps you need to take to improve your chances for next time.

Resubmit with a lower dollar amount

If you were approved for a balance transfer credit card but your transfer request was higher than your card limit, try submitting a balance transfer request for a lower amount. Some issuers only allow you to transfer a balance up to a certain threshold, such as 75 percent of your credit limit.

A transfer request that’s right at your credit limit is more likely to be rejected, so if you think lowering your sights would still help you meet your debt payoff goals, try again.

Consider a personal loan

A debt consolidation loan allows you to wrap up all your debt into one package, often with a lower interest rate. If a balance transfer doesn’t pan out, a debt consolidation loan could be another great option.

Ask about a lower interest rate

If your balance transfer with a new issuer hasn’t worked out, you can always go to your current credit card company and request that they lower your interest rate on your existing card. You won’t be paying 0 percent interest, but lowering your rate by even a few percentage points may help you to pay down your debt faster and more efficiently. Visit Bankrate’s credit card interest calculator to see how different interest rates could affect your balance.

Keep an eye on your credit score

Check your credit score regularly. You can get a free credit score from each bureau once a year, and many credit card issuers also provide free access to either your FICO or Vantage credit score through your online account. If your score isn’t good or excellent, make a serious effort to build your credit. Simple solutions like making payments on time, keeping your credit utilization as low as possible and avoiding applying for too many loans or credit cards within a short time period can improve your credit score.

Also, take a look at your credit report and fix any errors. False information in a credit report can impact your score significantly. If you discover an error on your report (such as an account that’s not yours, a debt marked unpaid that you know you’ve paid in full, etc.) it’s important to take steps to correct mistakes.

Research cards before applying

Before you apply for another balance transfer credit card, take time to understand the details and benefits of each one to help decide which may be the best fit for you. For example:

  • What credit score do I need to be approved for this card?
  • Does it have a balance transfer fee?
  • How long do I have to make a balance transfer request after opening?
  • What is the transfer limit of the card?
  • What is a typical credit limit on the card?