Millions of people in the United States have to deal with credit card debt. Once you have a lot of credit card debt, it can be hard to get rid of it. This problem can be fixed with balance transfer credit cards. Balance transfer credit cards can help you get out of debt if you know how they work.
How to Transfer a Balance on a Credit Card
Balance transfer credit cards let you move the amount you owe on other credit cards to their card. Many offer a low interest rate or an introductory rate of 0% APR on the amount being transferred. You can avoid having to pay hundreds of dollars in interest this way. By making payments every month, the balance goes down and you save money on interest.
Learn about the Fees
There are many different kinds of credit cards that let you transfer a balance. Some charge a fee to transfer balances, while others don't. Some credit cards have low interest rates for a certain amount of time, while others have a low interest rate that stays the same until the balance is paid off. Some credit cards that let you transfer a balance come with a rewards programme or other perks. Balance transfer credit cards usually have a great rate for the first transfer, but some have a high rate for new purchases. Finance charges will be paid off first, then the amount you transferred, and finally the new purchases. Your best bet is to find a credit card that lets you transfer a balance and gives you 0% APR on new purchases for as long as the promotion lasts. You might be surprised by how many credit card companies offer 0% APR for up to a year on both balance transfers and new purchases.
Look at your money.
Before you apply for a balance transfer credit card, you should make sure you know how much money you have. Look at your credit cards and how much interest they charge. If you have high-interest balances, you could be paying hundreds of dollars in interest each month. The first amounts put on the cards could take years to pay off. You can pay off the balances faster if you move them to a credit card with a low interest rate. Also, balance transfer credit cards let you combine your debts into a single payment. Keep in mind that some credit cards that let you transfer a balance only offer a low interest rate for a limited time. Many credit cards have high interest rates or rates that change every six months or a year. If you haven't paid off the balance by then, the higher interest will keep adding to your debt and work against you. If at all possible, you should pay off the transferred credit card debt during the grace period.
Get out of Here
After you've done your research and figured out your finances, you're ready to apply online for a balance transfer credit card. Choose the one that works best for you. Then set up a way to pay off the rest of the debt. Getting out of credit card debt can start with a balance transfer credit card. By putting all of your credit card debt in one place, you can make just one easy payment each month. You will also get to pay 0% interest on your balances for a certain amount of time. With a little planning, you can get rid of your credit card debt and learn how to handle your money well.
