A consumers’s guide to Balance Transfer Cards


Whilst many providers no longer offer the infamous 0% balance transfers of old that could see you transferring your balance for years without ever paying interest, there are still some pretty good deals out there that could net you a saving if you have a considerable balance. In this guide we explain the ins and outs of balance transfers and what you should be considering before moving your balance.

How balance transfers work
Balance transfers allow you to move a debit balance from one credit card to another. The benefit of moving is that various providers offer low interest rates on the moved balance, which means that you should be able to make a saving on the difference in rates between old and new provider.

Invariably however you’ll find that there is an initial charge for moving the balance (which may be tacked onto the balance post move); this charge is generally based on a percentage of the total amount being transferred.

Each and very transfer will be subject to a set period where a promotional interest rate will apply; in order to keep in control of your finances you should establish when this date is and make plans for increased payments when it comes around.

How to make a saving on your balance transfer
Using price comparison engine
Today price comparison engines are more robust than ever, including everything from home insurance to all manner of banking products. Balance transfers are no different, and finding the most suitable deal for you may well be just a matter of using such a website.

You should bear in mind however that these websites only serve as a brief overview of what’s on offer, you’ll need to check out each provider’s terms and conditions in detail before going ahead with any deal. In particular you should be looking at the interest rate, the amount charged (if any) for moving the balance and what the interest rates are after any set promotional period.

Other factors to consider when taking out a balance transfer
Credits checks
With each and every balance transfer you make you’ll have a credit check performed by the provider in question. Whilst this isn’t normally a problem for those who don’t take out credit products frequently, applying for numerous balance transfers or transferring your balance regularly could see your credit worthiness suffering.

Is a credit card the most appropriate solution?
If you’ve found that you’re continually moving your balance from one provider to the next then perhaps a balance transfer isn’t the most suitable option. In this instance it is obvious that the repayments are an issue and so rolling your debt (along with any others) into a loan may be advisable. Speak to your banking provider if you feel that this is the case.

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