Credit card balance transfers have fallen from favor somewhat since their heyday a few years ago, after the introduction of the balance transfer fee stopped the practice of shifting debt from card to card without incurring any charges or costs. It is now no longer possible to delay interest payments on credit card debt indefinitely - or at least to do so for free.
In spite of this fact, making use of balance transfer facilities could still be worth your while. The recently introduced fees for transferring debts does increase overall costs but a careful analysis and calculation will still show that in many cases you'll save money by doing so rather than keeping your old credit card loaded with debt. However, it's not the simple matter it once was and so it is important to consider a few points regarding transferring one's balance on credit cards if you're to make a success of the process.
It's now all but impossible to find a credit card without a balance transfer fee, but that doesn't mean there's nothing to separate different cards. The most common fee nowadays is 3% of the transferred balance, but as always it's worth checking if there's a card with a lower fee - ones spotted recently boast a less stinging 2% which could save you a lot on a large transfer.
There's also the question of maximum charges. Some cards limit the total transfer fee you have to pay, usually to around fifty pounds or so, but many cards ave no such upper limit. Depending on the size of your transfer, it may well make more sense to use a card with a high percentage fee but a cap on the total payment size rather than one with a lower rate but no upper limit,
Once you've selected a card with the least onerous balance transfer fee, you need to find one with a decent overall transfer offer. Where once 0% for 6 months was the norm, this is looking pretty unimpressive these days. You should be looking for an introductory interest free period of at least 12 months, with some of the best cards now offering 15 months or even more.
Whichever balance transfer card you choose, it's important to stay focused on why you've taken out that card; the avoidance of interest payments on your debt. Don't be tempted by rewards schemes, cash back, or other incentives to spend using your new card as this will negate the interest-saving benefits. Always keep your balance transfers and purchases separate if you want to get the best out of your cards and to keep the amount you pay for using them to a minimum. - 16928
In spite of this fact, making use of balance transfer facilities could still be worth your while. The recently introduced fees for transferring debts does increase overall costs but a careful analysis and calculation will still show that in many cases you'll save money by doing so rather than keeping your old credit card loaded with debt. However, it's not the simple matter it once was and so it is important to consider a few points regarding transferring one's balance on credit cards if you're to make a success of the process.
It's now all but impossible to find a credit card without a balance transfer fee, but that doesn't mean there's nothing to separate different cards. The most common fee nowadays is 3% of the transferred balance, but as always it's worth checking if there's a card with a lower fee - ones spotted recently boast a less stinging 2% which could save you a lot on a large transfer.
There's also the question of maximum charges. Some cards limit the total transfer fee you have to pay, usually to around fifty pounds or so, but many cards ave no such upper limit. Depending on the size of your transfer, it may well make more sense to use a card with a high percentage fee but a cap on the total payment size rather than one with a lower rate but no upper limit,
Once you've selected a card with the least onerous balance transfer fee, you need to find one with a decent overall transfer offer. Where once 0% for 6 months was the norm, this is looking pretty unimpressive these days. You should be looking for an introductory interest free period of at least 12 months, with some of the best cards now offering 15 months or even more.
Whichever balance transfer card you choose, it's important to stay focused on why you've taken out that card; the avoidance of interest payments on your debt. Don't be tempted by rewards schemes, cash back, or other incentives to spend using your new card as this will negate the interest-saving benefits. Always keep your balance transfers and purchases separate if you want to get the best out of your cards and to keep the amount you pay for using them to a minimum. - 16928
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