Step by Step Guide to a Balance Transfer

Recommended Balance Transfer Cards are at The End of This Guide.  

Step 1. Balance Transfer Basics

A balance transfer means you move your high-interest balance from one credit card to another with a 0% intro interest period. Some cards offer a year or even longer of 0% interest, which can save you hundreds of dollars in high-interest charges.  That gives you breathing room to pay down your debt, with no new interest charges piling up on that balance.

  Current Credit Card New Balance Transfer Card
Debt $5,551* $5,551*
Interest Rate 17% APR 0% intro APR for 15 months

That gives you 15 months to chip away at your balance with no interest payments piling up. If you pay $370.07 per month during the 15-month promotional APR period you would save an incredible $1,551.65 in interest and pay off your balance in full.

*Consumers have an average credit card balance of $5,551 according to Experian’s 2016 State of Credit report.

Consolidate multiple cards. A balance transfer is a great opportunity to consolidate your debt onto one card. If you have balances on a couple of cards, including store credit cards, you can consolidate them onto your new balance transfer card with a 0% intro APR. Having just one credit card bill each month can be easier to manage.

Good tip: Once your account is open, you may be able to transfer other types of debt too, including car loans using checks from the bank that issues the credit card.

Step 2. Apply for A Balance Transfer Credit Card

Great offers. There is a balance transfer war right now among the banks and they are fighting for your business. There are offers with ultra-long 0% intro APR and some cards waive the balance transfer fee if you start the transfer within a certain time.

To help you choose the best balance transfer card consider these features:

  • Length of the 0% interest period. How long do you need to pay off your debt?
  • Balance transfer fee. Some cards charge a 3-5% balance transfer fee. That means if you transfer $5,000 in debt from one card to another with a 3% fee, you will pay $150 to do that. While that may sound like a lot, it can be a smart move and save you hundreds of dollars in interest. 
  • Annual fee. No-annual fee cards are the most cost-effective way to get out of debt.
  • Cash-back. Some cards offer cash-back rewards that you can use to pay down your debt faster.

Step 3. Confirm the Transfer Is Complete

The transfer could take 7-14 days to complete. Continue to make your payments on the other credit card until you see that the balance has been paid. That way you can avoid late fees.

Step 4. Say Goodbye to High Interest Debt

Applying for a balance transfer credit card is the first step to right your financial ship. Once you have been approved for your new card, take full advantage of your 0% introductory balance period to chip away at debt using these tips below.

  • Take stock of your monthly expenses and make a budget. Are there areas you can trim?
  • Be careful about your spending. Just because you have a 0% intro period on balances (and maybe on purchases too), it’s not a free pass to spend.
  • Make it a goal to pay off as much as you can of your balance before the 0% period ends.
  • Pay your bill on time. If you pay late you could lose your introductory 0% rate.
  • Balance transfers won’t close your old credit card account. If you keep it open, lock it away in a drawer and don’t rack up new charges.

We've done the research. These are the top balance transfer offers:

Apply now for a balance transfer credit card. This is a powerful first move to help you break free from high interest debt. Feel good about taking this positive financial step forward! See all balance transfer options here. 

*Editorial Note: This content is not provided or commissioned by the credit card issuer. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.