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What Is a Balance Transfer Fee?

What Is a Balance Transfer Fee?

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This article was last updated Sep 22, 2020. Terms and conditions may have changed. For the most accurate information, please consult the issuer website.

Balance transfer credit cards can boost your debt payoff strategy by allowing you to move high-interest debt to a card offering low or no interest for a specified period of time.

Depending on the balance transfer card, you may be charged a fee that is added to the transferred amount on the new card. However, the balance transfer fee is often outweighed by what you save on interest with the balance transfer card.

Before completing a balance transfer, you should know how balance transfer fees are calculated and which cards waive them.

What is a balance transfer?

A balance transfer involves transferring debt from one or more credit cards to another credit card offering an intro balance transfer APR. Since balance transfer credit cards offer introductory APRs that typically are much lower than standard interest rates, they provide a means to pay down your credit card debt more quickly by allowing more of your payments to go toward the debt principal rather than the principal plus interest.

Many balance transfer credit cards offer 0% intro APRs for a set period of time — six months on the short end and 21 months on the long end.

For example, the Citi Rewards+℠ Card offers an intro APR of 0% for 15 months on balance transfers. Once the introductory period ends, a regular APR of 13.49% - 23.49% (variable) will apply to any unpaid portion of the transferred balance.

  • 0% for 15 months

  • Earn 15,000 bonus points after you spend $1,000 in purchases with your card within 3 months of account opening; redeemable for $150 in gift cards at thankyou.com

  • 13.49% - 23.49% (Variable)

Highlights
  • The Citi Rewards+℠ Card - the only credit card that automatically rounds up to the nearest 10 points on every purchase - with no cap.
  • Earn 15,000 bonus points after you spend $1,000 in purchases with your card within 3 months of account opening; redeemable for $150 in gift cards at thankyou.com
  • 0% Intro APR on balance transfers and purchases for 15 months. After that, the variable APR will be 13.49% - 23.49%, based on your creditworthiness. Balance transfer fee — either $5 or 3% of the amount of each transfer, whichever is greater.
  • Earn 2X ThankYou® Points at Supermarkets and Gas Stations for the first $6,000 per year and then 1X Points thereafter. Plus, earn 1X ThankYou® Points on All Other Purchases.
  • The standard variable APR for Citi Flex Plan is 13.49% - 23.49%, based on your creditworthiness. Citi Flex Plan offers are made available at Citi's discretion.

See additional details for Citi Rewards+℠ Card

More Info

What is a balance transfer fee?

The majority of balance transfer cards charge a fee when you transfer an existing balance to the new card, which typically ranges from 3% to 5% of the amount of each transfer.

Since the balance transfer fee is added to the card balance at the time of your transfer, you can pay the fee over time as you pay down your transferred balance.

 

There are balance transfer cards available that don’t charge balance transfer fees; however, those cards often have shorter intro APR periods on balance transfers. Meaning, you’ll have less time to pay off your balance without incurring interest charges.

That said — even if a card charges a balance transfer fee, it can still help you save thousands of dollars in interest charges.

For example, let’s say you have $10,000 worth of existing credit card debt at an interest rate of 22%. If you transfer that amount to a credit card with a 0% intro APR for 18 months and a 3% balance transfer fee, you’ll pay a balance transfer fee of $300. But you’ll end up saving $1,792 in interest charges if you pay off the entire balance in 18 months (which would require monthly payments of approximately $670).

See how long it may take you to pay off your credit card debt with our balance transfer calculator.

Best balance transfer credit cards

There are a variety of credit cards that provide 0% introductory APRs on balance transfers for more than a year, while charging a balance transfer fee.

The Citi® Diamond Preferred® Card offers one of the longest intro periods currently available. The card comes with an intro APR of 0% for 18 months on balance transfers and an ongoing APR of 14.74% - 24.74% (variable). A balance transfer fee applies with this offer: 3% of each balance transfer; $5 minimum.

  • 0% for 18 months on Purchases

  • 0% for 18 months on Balance Transfers

  • 14.74% - 24.74% (Variable)

Highlights
  • 0% Intro APR for 18 months on purchases from date of account opening and 0% Intro APR for 18 months on balance transfers from date of first transfer. After that the variable APR will be 14.74% - 24.74%, based on your creditworthiness. Balance transfers must be completed within 4 months of account opening.
  • There is a balance transfer fee of either $5 or 3% of the amount of each transfer, whichever is greater
  • Get free access to your FICO® Score online.
  • With Citi Entertainment®, get special access to purchase tickets to thousands of events, including concerts, sporting events, dining experiences and more.
  • Shop with confidence knowing that you have dependable protection benefits, including $0 Liability on Unauthorized Purchases and Citi® Identity Theft Solutions.
  • The standard variable APR for Citi Flex Plan is 14.74% - 24.74%, based on your creditworthiness. Citi Flex Plan offers are made available at Citi's discretion.

See additional details for Citi® Diamond Preferred® Card

More Info

How to do a Balance Transfer with Citi

Similarly, the Citi® Double Cash Card – 18 month BT offer has an intro APR of 0% for 18 months on balance transfers. After that, a regular APR of 13.99% – 23.99% (variable) applies to any unpaid portion of the transferred balance. The card also charges a balance transfer fee of 3% of each balance transfer; $5 minimum.

  • Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.

  • 0% for 18 months on Balance Transfers

  • 13.99% – 23.99% (Variable)

Highlights
  • Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
  • To earn cash back, pay at least the minimum due on time.
  • Balance Transfer Offer: 0% intro APR on Balance Transfers for 18 months. After that, the variable APR will be 13.99% – 23.99%, based on your creditworthiness.
  • Balance Transfers do not earn cash back.
  • If you transfer a balance, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month.
  • There is a balance transfer fee of either $5 or 3% of the amount of each transfer, whichever is greater.
  • The standard variable APR for Citi Flex Plan is 13.99% – 23.99% based on your creditworthiness. Citi Flex Plan offers are made available at Citi's discretion.

See additional details for Citi® Double Cash Card – 18 month BT offer

More Info

The Wells Fargo Platinum card also offers an intro APR of 0% for 18 months on qualifying balance transfers, then a regular APR of 15.49%-24.99% (variable) applies. Cardholders are subject to a balance transfer fee of 3% for 120 days, then 5%.

Best balance transfer credit cards with no transfer fee

If you don’t want to pay a balance transfer fee, there are a select number of credit cards that offer 0% intro APRs on balance transfers without charging a balance transfer fee.

The Platinum Card from Navy Federal Credit Union offers a 0% introductory APR for 12 months on balance transfers. Once the intro period ends, a regular APR of 7.49% - 18.00% variable applies. As for balance transfer fees — there are none.

The Chase Slate® comes with a 0% Intro APR on Balance Transfers for 15 months. After that, a regular APR of 16.49% - 25.24% variable applies. The Chase Slate® offers a balance transfer fee of $0 for the first 60 days that your account is open, after that, either $5 or 5% of the amount of each transfer, whichever is greater.

How to Do a Balance Transfer with Chase

Frequently asked questions

Can I transfer a balance between two cards from the same issuer? 

You cannot transfer balances between two cards from the same issuer. For example, you can not transfer a balance from one Discover card to another Discover card.

Can I transfer a balance immediately after opening a new credit card account?

While it’s best to start the balance transfer process as soon as possible, issuers may require your account to be open for a set period of time first. For example, Discover requires your account to be open for 14 days before a balance transfer can begin being processed.

How much can I transfer?

That depends on the credit limit the issuer gives you on your new balance transfer credit card. However, in general, the amount you are eligible to transfer will be less than your credit limit and may be determined by other factors, such as your creditworthiness and account history.

5 Options for When a Balance Transfer Credit Limit Isn’t Enough

What is the balance transfer window?

A balance transfer window is the amount of time you have to complete a balance transfer and take advantage of the card’s introductory APR on balance transfers. For example, with the HSBC Gold Mastercard® credit card, the intro APR on balance transfers only applies to balances posted to your account within the first 60 days of account opening.

How long does it take to complete a balance transfer?

Once you request a balance transfer, it may take up to three weeks to complete. For example, with Chase, most transfers are processed within one week, but it may take up to 21 days.

Just know, it’s important to stay current on your existing credit card payments until you receive confirmation that your transfer has been completed.

What are some best practices when transferring a credit card balance?

Before getting started, familiarize yourself with the terms of the balance transfer offer — such as the total amount you’re allowed to transfer and the amount of time you have to complete the transfer.

Do not use your balance transfer card for new purchases, since the main goal of the card should be to pay off the entire transferred amount before the promotional period ends, and not add to your debt.

Also, create a plan to pay off your debt before the introductory period ends. You can do this by calculating the amount you need to pay each month until the promotional period ends and setting up automatic payments.

5 Things to Do Once Your Balance Transfer is Complete

The information related to Chase Slate® has been independently collected by CompareCards and has not been reviewed or provided by the issuer of this card prior to publication. 


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