Editor’s Top Credit Card Offers

How To Transfer Your Credit Card Balance To a Better Credit Card

Depending on the credit card you select to transfer your balance over to, you could also be able to benefit from a rewards points program or even a cash back option. Some cards will even offer travel accident insurance cover and others may offer the benefit of extending the manufacturer’s warranty on any new purchases you make using the new card.

Before you decide to transfer your credit card balances it’s important to research your options carefully as not all offers are as rosy as they’re made to appear.

1) Research Balance Transfer Offers

Before transferring any of your balances you need to be sure the new credit card will benefit you in the long run. If the fine print reveals that the hidden fees and charges will only see you right back where you started, then there’s really no point in going ahead with the balance transfer.

For example, some credit card companies may offer great introductory rates that sound really low, but you need to know precisely how much you’ll be charged once that introductory period ends. Other companies may not offer the attractive rate on balance transfers, so you might not even receive the rate you thought you were signing for.

You’ll need to know if you’ll be charged an annual fee on your card and it’s wise to ask if the new credit card company charges a fee to conduct your balance transfer for you. Most balance transfer fees are around 3-4% and are added to your total balance, so this could actually increase your total debt.

2) Credit Score Matters

Many of the great credit card offers with the really low rates require that you have a good credit score and repayment history. If your credit score is a little on the low side then you might find the credit card company will only approve your balance transfer with a different interest rate to the one they advertised.

The point of credit card companies advertising their very best rates is to attract new customers. This doesn’t always mean every customer will receive the great deals though.

Be sure you look closely at your credit contract and double check that you qualify for the credit card offer you thought you were applying for. If you find that your credit score has increased the interest rate the credit company wants to charge you, then work out whether transferring your balance at this higher rate will be saving you any money or benefiting you at all.

3) Submit Your Application

Once you’ve found a new credit card that will save you money, offers you lower interest rates and looks as though they’ll approve you for that particular offer, it’s time to submit your application.

On your application, be sure to fill out the details on the balance transfer portion. If you leave it blank at this point and intend to transfer your old credit card over at a later point the new company might consider this a cash advance and you may lose some of the benefits you thought you would receive.

4) Old Credit Card

Just because your old balance has now been transferred to the new credit card with the better terms doesn’t mean the old card isn’t still there. The balance may be gone but the account isn’t.

If you’re serious about reducing your debt levels, you’ll write to your old credit card company and close the account completely. However, if you think you have the discipline not to charge more things to the old card, put it away in a safe place for emergency use.

Whatever you decide, don’t start using the old card again or you’ll have defeated the purpose of transferring your balance and you’ll suddenly find yourself with two credit cards to repay.