How to Do a Balance Transfer

September 25, 2019

By Sherry Keyles

Are you struggling to pay off your credit card debt? Is the debt growing thanks to a high-interest rate? If you are looking for an easy way to pay off your credit card debt while saving money on interest, a balance transfer credit card might be able to help.

Balance transfer credit cards enable you to transfer existing credit card debt to a new credit card with a 0% introductory APR balance transfer offer. By avoiding interest for a certain time period (most balance transfer offers range from 12-18 months), you not only save money but you can eliminate the debt quicker.

In addition, if you have debt on multiple credit cards, you can consolidate the balances to one card, simplifying your finances by giving you only one payment to make each month. However, because most balance transfer credit cards charge a 3% or 5% fee on the transferred amount, transferring too many balances can get expensive.

If you’ve decided a balance transfer credit card is your best course of action in eliminating your credit card debt, here are the steps to take.

  • Check your current balance and interest rate

Before doing a balance transfer, review your current credit card balances and interest rate. This information will help in selecting the balance transfer card that best fits your needs.

  • Check your credit score

Balance transfer credit cards with 0% APR offers require very good to excellent credit. Selecting the right card will be a lot easier if you know your credit score. If your credit score is on the low side, a balance transfer card might not be the best option.

  • Find the right balance transfer card

There are many balance transfer credit cards available so it’s important to shop around and compare offers. Before you start reviewing offers, you need to figure out how much you can afford to pay each month.  Take your total debt amount and divide by 12, 15 and 18 months. You want to make sure you can pay your balance off before the introductory offer expires. Otherwise, when the introductory period ends, a high regular interest rate (ranges from 17% - 26%, based on creditworthiness) will be applied to the remaining balance.  When comparing offers, keep the following factors in mind:

  1. Length of 0% introductory APR - generally, the longer, the better
  2. Credit or balance transfer limits - ensure you can transfer your entire balance to the new card
  3. Balance transfer fees - make sure fees don’t cancel out the savings from the 0% APR. Typically, depending on your debt amount, the 0% APR can offset the balance transfer fee
  4. Time requirements for transferring your balance - most cards require the balance transfer to be made within 60 days of account opening
  5. Card issuer - Most balance transfer cards do not allow balance transfers between accounts from the same issuer.
  6. Fine print - read the card’s terms and conditions to ensure the card is favorable to your situation. The terms and conditions will outline other fees including late fees and penalty APR if you miss a payment. It’s important to find out the requirements for keeping the 0% APR. Some cards will disqualify you from the promotional offer if you miss one payment.
  • Apply for a balance transfer card

Fill out the application with your personal and financial information, including the section of the application for requesting a balance transfer. It’s a good idea to request the balance transfer when you apply since the 0% APR period usually starts on account opening. Apply online to expedite the application process. If you mail the application, processing will take longer.

  • Keep making payments

Do not stop making payments on your existing account until you confirm the balance transfer is completed. Otherwise, you may rack up late fees. You will be credited for any payments made during this period.

  • Receive a decision

It usually takes several weeks to find out whether you have been approved or denied for a balance transfer credit card. Depending on your creditworthiness and available funds,  you will either be approved for the full requested amount or for part of your balance.

If you didn’t request the balance transfer when you submitted your application, contact your new credit card issuer to make the request. Most issuers allow you to make balance transfers online or by phone. You should do this as soon as possible so you can meet the time requirements. While balance transfers can be helpful in paying off your credit card debt, they aren’t going to make your debt disappear overnight. You still have to repay your debt. In order to make the most of a balance transfer credit card, you need to commit to paying off your debt - and remaining out of debt. Make your payments on time every month. If you can afford it, try to pay more than the minimum. Remember, you want to eliminate your debt before the 0% APR introductory period expires.


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