Comparing Balance Transfer Cards To Get The Best Deal

February 17th, 2010

The best balance transfer cards are those ones that most closely suits your requirements. You shouldn’t make an application for such a card before taking into account the size of your debt and how soon you think it can be paid off.

Once you have established these factors, you will be able to focus in on a certain type of balance transfer card. That might be a six months deal at 0%, twelve months at around 3-5%, or a lifetime of the balance deal at around 6-8%. Other offers may be available but these are the ones you will come across most often.

Beyond this, you will have other factors to take into account. This will certainly be the case if you are in any danger of being unable to pay off your debt in full within the offer period, and also if you don’t want to just discard your card once it has served its main purpose.

The ongoing regular interest rates

These are the rates that you will pay for your purchases or cash advances should you be daft enough to make any whilst you have a transferred balance on your card. These should be avoided because they will not be paid down at all until your transferred debt has been cleared, meaning you will be accruing interest untouched at much higher rates.

However, even assuming you do avoid purchases and cash transactions, you should take these interest rate figures into account because one of them will be the rate that takes over on any unpaid transfer when your offer period expires.

Mostly, the rate reverts to the purchase interest rate, but you should also check whether it instead reverts to the cash advance interest rate, which is usually around 20%. There is no point seeking out the lowest purchase interest rate on a balance transfer card if this is not the rate that will take over.

If you want to use your card for regular purchases once your transferred debt has gone, then regular interest rates will be important, especially if you think you might start racking up further debt.

The annual fee

There are a few balance transfer cards that do not charge an annual fee, but this is not the norm and you may not get the best balance transfer deal on a no annual fee credit card. The annual fee is something to consider, but it is not nearly as important as the balance transfer deal itself.

Paying $10 more on an annual fee is worthwhile if you get a few extra months on your balance transfer deal, or you secure a lower interest rate for your balance transfer than is being offered elsewhere.