Transfer Your Credit Card Balance for Lower Interest Rates

A Credit Article Contributed by Kris Griebe

Why Should I Transfer My Credit Card Balance?

A transfer of your credit card balance is useful when you are needing to save money. It sounds complicated, but it really isn't. It is as easy as a simple phone call, or sometimes just filling out a form online. Here is how it works.

If you receive a new credit card with a low APR, in order to save money, you can transfer the balance on your current credit card to your new credit card. Let's say you have a credit card with an 18% interest rate. If you apply for, and obtain, a new credit card with a 12% interest rate, it is to your advantage to transfer your balance to your new card. When you do this, you will find yourself saving 6% on interest! This can mean hundreds and hundreds of dollars for those with high credit card balances!

Can I Get a Deal on My Credit Card Balance Transfer?

Of course! Many credit cards offer some sort of deal to those who wish to transfer their balance over. This works for a number of reasons. By allowing you to transfer your balance, and making it appealing to do so, this new credit card company will get new business. The majority of customers will continue using their card once it is paid off. Therefore, even though the company may lose money off the actual transfer, they will make the money back when you keep their card and use it.

Almost every credit card company that allows balance transfers has a deal of some sort. It is almost mandatory, if they wish to compete with all the other credit cards that offer balance transfers. There is no reason you, as a consumer, would go with a card that will offer you less!

What Kind of Deal is Most Common on a Credit Card Balance Transfer?

The most common (and also the best, lucky for you! ) deal is the 0% APR balance transfer deal that nearly every company offers. This deal lets you transfer your existing balance on to a new card, and then pay no interest on your balance for a limited time! So, if you have two thousand dollars on a credit card, and you transfer it to a new card with a 0% transfer deal, you will find yourself saving a whole load of money!

In reality, there is no reason NOT to do this. You can always keep your current card. In fact, using this method, you can save yourself plenty of interest payments. If you are satisfied with your current card, but you have a large balance, then transfer your balance to a new card, get the 0% interest deal, and pay off your balance with no interest. When you are done, you can either use the other card you obtained, or you can simply cut it up and go on with life. Either way, in the process, you saved yourself money that would have otherwise went to needless interest payments!