Balance Transfer Credit Cards
Credit Card balance transfers are a great idea if you have a credit or store card with a significant balance which you are unable to clear, resulting in you carrying it over from one month to the next, incurring charges each time.
Is Transferring Balances the Right Option For You?
To decide if this is the right decision for you, you need to consider the current charges you are paying each month versus the balance transfer fees as there is usually a charge unless you find a provider who is offering free balance transfers.
Are the fees less than your charges would be? Take into account a realistic view on how long it would take to clear your balance ie: 8 months. After you have worked this out, consider if it really would be wise to take out a 0% card and transfer your balance. Be aware though that with 0% transfer cards if you go on to make a purchase on that card, when you make a payment the transfer balance will be reduced first meaning that the purchase made will not be cleared until after the transfer balance has been cleared. As a result this means interest being added to your card. The way to ensure you pay no interest charges is to make no purchases on the card which you transfered your balance to, if you still have another card use that one and clear the balance each month, and if not maybe consider applying for a cashback credit card for your purchases so you can earn money as you spend.
How else can you make balance transfers work for you and be a cost effective option?
Avoiding Interest Charges after Balance Transfers
Following a balance transfer there are a few things that you need to keep in mind regarding the use of your credit card and these are:-
1) Don't make any further purchases on your credit card
2) If you cannot avoid additional credit card purchases use the credit card from which your made the transfer. This way you can clear just that item from your card whilst continuing to make the payments on your transfer credit card.
3) Calculate how much you need to pay each month to clear your 0% transfer balance within the time scales. Set up a Direct Debit for this amount to ensure that you do not keep putting it off for another month, making a small payment instead.
4) Be careful not to get yourself into the same situation you were in before.
With Balance Transfer cards you will usually find that the balance stays at 0% for a set period, some are 6, 9 or 12 months but there are cards on the market which offer up to 16 months at 0%. After this time though the interest will go to that which the credit card company would normally charge eg: 18.9% so if you have a choice of 0% cards, take a look at the normal interest rate too, as this may help you choose which provider to use. You could of course choose to move your credit on a regular basis, but is this a practical option to make Continuous Balance Transfers?
Who provides the longest term 0% Balance Transfer Credit Card?
At the time of writing, the longest period we could find was 16 months term on the Virgin Money Card with fees of 2.98%. If you know a card with a longer 0% period please let us know.
Who provides 0% balance transfer credit cards with no charges?
The only no fee deal we can find at the time of writing is 0% for 5 months - MasterCard Standard with the Northern Bank which is available only with their Northern Freedom & Northern Choice packages.