What Is A Balance Transfer Fee? (2024)

FAQs

What Is A Balance Transfer Fee? ›

A balance transfer fee is what credit card issuers charge when you transfer debt from one credit card to another. Balance transfer fees are typically 3 percent or 5 percent of the total balance you transfer to your new card.

A balance transfer fee is a fee that's charged when you transfer credit card debt from one card to another. It's usually around 3% to 5% of the total amount you transfer, typically with a minimum fee of a few dollars (often $5 to $10).

This fee will typically be 3% to 5% of the amount transferred, which translates to $30 to $50 per $1,000 transferred. The lower the fee, the better, but even with a fee on the high end, your interest savings might easily make up for the cost. Length of 0% introductory period.

A balance transfer fee is a one-off charge you'll usually have to pay to switch a balance. It's usually a percentage of the amount of debt that you transfer – the typical fee is around 3%, with a minimum charge of about £3.

A balance transfer credit card moves your outstanding debt from one or more credit cards onto a new card, typically with a lower interest rate. Your total amount of debt remains the same.

a payment that you make when you move a balance (= the amount that you owe) from one credit card to another. You make the payment to the issuer (= bank, etc.) of the card to which you move the balance: Many credit card issuers charge balance transfer fees.

Typically, you'll be charged a balance transfer fee that's a percentage of the amount you're transferring from each card, usually between 1% and 5%. Bear this in mind because, if you have multiple cards to transfer, the fees can mount up. Not all cards charge transfer fees, though.

How to avoid balance transfer fees. Usually, the only way to avoid balance transfer fees is to find a card that waives the fee entirely. These types of cards are typically issued by credit unions as opposed to major credit card issuers — which can have both benefits and disadvantages.

If you need extra time to pay off a big credit card purchase, transferring the balance to a balance transfer card can be a smart move. If you manage to pay off your balance before the intro period ends, you can successfully dodge interest that may otherwise have been added to your balance.

A balance transfer can improve your credit over time as you work toward paying off your debt. But it can hurt your credit if you open several new cards, transfer your balance multiple times or add to your debt.

Can I negotiate balance transfer fee? ›

You can always call your credit card issuer to see if you can get a lower balance transfer fee. While they might not say yes, it's worth seeing if you can negotiate the balance transfer fee on an existing offer.

Is a balance transfer fee worth it? If you have a significant amount of credit card debt, the 3% balance transfer fee (or sometimes even a 5% fee) is absolutely worth paying when transferring your balance to a card that has a 0% intro APR offer, but only if you still need time to pay off a balance.

Higher Interest Rates After Introductory Period

Most balance transfer offers are only good for a limited time. If you don't pay off your total balance before the end of the promotional period, you may incur interest on the remaining balance at a high APR.

Your old credit card will remain open after the balance transfer is complete, and you can decide whether you want to keep using it, stop spending on it, or close your account.

A balance transfer fee is the amount of money a lender charges a borrower to transfer existing debt from another institution. This fee is commonly charged by credit card companies when cardholders move balances from one card to another. The fee is usually a percentage of the total amount transferred by the debtor.

If you don't pay off the full transferred balance before the end of the introductory period, you may end up paying more interest down the road.

A balance transfer credit card is an excellent way to refinance existing credit card debt, especially since credit card interest rates can go as high as 30%. By transferring your balance to a card with a 0% intro APR, you can quickly dodge mounting interest costs and give yourself repayment flexibility.

A balance transfer can affect your credit score, depending on 1) if you open a new card to transfer a balance and 2) what you do once your balances have been transferred. If you simply move your balances around on your existing cards, your credit score likely won't be impacted.

Downsides of balance transfer cards

Temporary 0% APR: The 0% intro offer will eventually expire, and your regular APR may be 20% or higher. Credit card limits: The credit limit on your new card may be lower than the amount you want to transfer, and your balance transfer fee will be deducted from your available credit.