What is a Balance Transfer Credit Card? One of the best ways to consolidate debt after a death is to simply apply for a balance transfer credit card. But getting a balance transfer credit card is not as easy as you think it is, which is why this article is coming your way today.
Today we are going to be considering what a balance transfer CC is and how we can obtain one. We are also going to consider how these types of cards work so that you can use them to your benefit.
What is a Balance Transfer Credit Card?
Without any further waste of time on this article, we are simply going to go directly to defining what a balance transfer credit card is.
Simply put, a balance transfer credit card is any type of credit card that allows you to transfer your balances from other accounts into it. Not all credit cards that claim to be balance transfer credit cards actually are balance transfer credit cards. There are specific things you should look for when picking a balance transfer credit card.
In most cases, a balance transfer CC usually offers a sign-up bonus of 0% APR. This means there is no interest in the first one or two years of making use of that card. This is so that you can easily repay your debt if you are using the balance transfer credit card to consolidate.
What is a Balance Transfer?
A balance transfer is simply a transaction where an existing credit or debit is moved from one account to another. This is usually one of the best options for people who are trying to pay off high-interest debt that they can’t seem to get rid of. By transferring your debt from a high-interest account to a zero-interest account, you can simply focus on paying off your debt without having to pay interest.
How does a Balance Transfer Credit Card work?
We already know what it means for a credit card to be a balance transfer CC, but now let’s take a brief look at how these types of cards work. Firstly, you need to apply for a credit card that has a 0% APR on balance transfers. However, qualifying for this type of card is easier said than done because you need a good or excellent credit score of at least 690.
After you have gotten the credit card, the next step is to initiate the transfer of your debit from whatever place it is to the balance transfer credit card. You can do a balance transfer either online or by phone by providing the issuer’s information. After you have initiated the balance transfer, all you have to do now is wait for the transfer to be done. Once the transfer is done, the last step is to now pay off the debt.
The Features of a Good Balance Transfer Credit Card
There are three major features that you should look out for in a good balance transfer CC. Any car having this feature is considered to be a good card to do balance transfers. These features are listed below:
- A good balance transfer CC should have a 0% introductory APR offer for balance transfers. This means that after you have transferred your existing debt to it, you should not be required to pay interest for at least 2 years.
- A good balance transfer CC will also have a $0 annual fee.
- Finally, a good balance transfer CC should have a $0 balance transfer fee or possess a way to avoid paying such a transfer fee.
With this type of card, you can potentially pay off your debt no matter how used it is without having to pay interest on it.
What kind of debt can be transferred to a Balance Transfer Credit Card?
A balance transfer CC can allow you to transfer any type of debt However you can transfer her interest rate debt so that you can pay it off easily without having to pay interest. You can transfer any form of high-interest rate debt, from car loans, student loans, personal loans, mortgages, and others to a balance transfer CC.
Who should get a Balance Transfer Credit Card?
What are you like The idea of a bank transfer CC is not for everybody. They are a specific group of people that should opt for a balance transfer CC. If your situation is among the ones listed below, you should go for a balance transfer CC:
- People that want to reduce the interest rate when paying down CC debt should opt for a balance transfer.
- If you have a large debt that you want a little extra time to pay off for a particular balance that you recently made, you can go for a balance transfer.
- When you have too much debt you are paying, you cannot keep up with all of them and want to consolidate them into one so that you can focus on paying them off.
- When you are paying a debt and it does not seem as if it is getting reduced, you should go for a balance transfer CC.
Should I do a Balance Transfer?
Going for a balance transfer is totally up to you. As you have seen above, if your situation is among those listed, then it is a monster to go for a balance transfer CC. However, if you can manage to pay off your balance in 3 months or less, you cannot qualify for a good balance transfer CC. This means you are better off looking at other options rather than a balance transfer CC.
Does Balance Transfer hurt your credit?
Balance transfers can both hurt your credit and, at the same time, improve your credit score. This is because when a balance transfer CC issuer pulls your credit report, a hard inquiry is entered into your credit history. Hard inquiries tend to lower your credit score. However, if you do successfully pay off a balance transfer, then your credit score will be better.
What is the point of a Balance Transfer?
The point of a balance transfer is to simply move your debt from where you are paying high interest to another place where you will no longer have to pay interest on it so that you can simply focus on paying off your debt without having to worry about paying interest on it. This is the main purpose of doing a balance transfer.