Megan Lee is a writer and editor who specializes in travel, personal finance, education, and healthcare. She has been published in U.S. News & World Report, REI, USA Today, and elsewhere, and has spoken at conferences like NAFSA’s Annual Conference & Expo. Megan has built and directed remote content teams and editorial strategies for several websites, including NerdWallet, GoAbroad, and Ramp. When she's not crafting her next piece of content, Megan adventures around her Midwest home base, where she likes to drink cortados (it’s research for her coffee blog, she swears), attend theme parties, ride her bike, and cook Asian food.
Key takeaways
A balance transfer lets you move existing credit card debt to a new card with a lower or 0% introductory APR to save on interest.
Consider the introductory APR, promotional period, balance transfer fees, and regular APR before choosing a card.
Pay off the transferred balance before the promotional APR expires to avoid higher interest charges.
If you're looking for a way to manage credit card debt, a balance transfer may help. This process lets you move your debt from one or more cards to a single card – and many offer a 0% introductory annual percentage rate (APR) for a set time to help you pay off debt faster.
Here's how to do a balance transfer in four steps – plus, how to decide if a balance transfer is right for you.
What is a balance transfer and how does it work?
A balance transfer is the process of moving existing credit card debt from one card to another – typically a new card that offers a lower or 0% introductory APR. The goal is to reduce the interest you pay so more of each payment goes toward the actual debt.
After you're approved for a balance transfer credit card, you provide the new card issuer with your existing debt details. The new issuer pays off your old card's balance, and that debt moves to your new account – ideally at a lower interest rate.
Most balance transfer cards charge a fee of 3% to 5%1 of the amount you transfer. Even with that fee, a balance transfer can save you money on interest if you pay off the debt during the promotional period.
Should you consider a balance transfer?
Whether a balance transfer makes sense depends on your individual situation. Here are a few things to think about before you apply.
Check the credit score requirements. You'll typically need decent credit to qualify for a balance transfer card with a 0% APR promotional period. Review the card's minimum credit score requirements before applying.
Add up the fees. Balance transfer fees are added to your transferred amount. For example, a 5% fee on a $10,000 balance transfer means you'd owe $10,500. A low-fee or no-fee card can help you maximize savings.
Weigh the timing. The 0% APR won't last forever. Review your budget to make sure you can pay off the transferred balance before the promotional rate ends.
Plan to put your cards away. A balance transfer can backfire if you charge up new balances on your old cards. Commit to avoiding new debt while paying down what you owe.
Step 1: Verify your current balance and interest rate
Start by reviewing the details of your credit card debt to determine how much you could benefit from a balance transfer. You'll want to know two things:
Check your latest credit card statement or contact your card issuer for this information. You'll need your total debt amount for the application, and knowing your current APR helps you confirm the new balance transfer credit card offers a better deal.
Step 2: Choose a balance transfer credit card
Once you know how much debt you want to transfer, it's time to compare balance transfer cards. The card you choose determines the balance transfer fee and how long you'll have to pay off the balance before the regular APR kicks in.
A typical balance transfer fee is 3% to 5% of the transfer amount1, or a flat fee of $5 to $101 – whichever is greater. That means a $10,000 transfer could cost you $300 to $500 in fees upfront.
Here are the most important factors to compare:
Introductory APR: The promotional rate offered on the transferred balance
Promotional period: How long you'll have to pay down the balance interest-free
Balance transfer fee: The upfront cost of moving your debt
Regular APR: The rate that applies once the promotional period ends
Review the terms and conditions carefully before moving forward. If anything is unclear, call the credit card company for clarification.
Step 3: Apply and initiate the balance transfer
Once you've chosen a card, the next step is to apply. You can typically apply for a balance transfer in one of these ways:
Online through the card issuer's website
Through the card issuer's mobile app
Over the phone with a customer service representative
Using a balance transfer check
On the application, you may need to provide the amount you want to transfer and your existing card account number. You'll also need personal details like your name, address, date of birth, and Social Security number.
Keep in mind that applying for a new card will trigger a hard credit check2, which can decrease your credit score by five points or less.
After you're approved, tell the new card issuer how much you want to transfer and from which account. The new issuer handles the rest – they'll communicate with your current card company to arrange the transfer.
Processing times vary – you might wait anywhere from two days to six weeks.3 If it's been a few weeks with no movement, call the card companies to check on the status. In the meantime, continue making payments on your old card to avoid a late payment fee.
Step 4: Pay off the transferred balance
Once the transfer goes through, focus on paying down what you owe. Divide your balance by the number of months in the promotional period to figure out your monthly target.
For example, a $10,000 balance with a 21-month 0% APR offer works out to about $476 per month. With a 12-month offer, you'd need to pay about $833 per month instead.
Reviewing your budget can help you figure out what's doable. If you don't budget regularly, looking at your checking account statements can show where your money goes each month.
Make the most of a balance transfer
If a balance transfer is the right move for your financial goals, compare card offers carefully, pay close attention to fees and the promotional period, and make a solid plan to pay off the debt before the regular APR kicks in.
If you'd like to compare balance transfers with other debt management strategies, learn more about how to consolidate debt using different methods.
Balance transfer FAQs
Do balance transfers hurt your credit score?
A balance transfer can affect your credit score in a few ways. Applying for the new card will result in a hard inquiry, which can cause a small, temporary dip in your score.2 Opening a new account also lowers the average age of your credit history, which can have a slight negative impact.4
However, a balance transfer can also help your score in the long run. By moving debt to a new card, you lower the credit utilization ratio – the amount of credit you are using compared to your total available credit – on your old card. A lower utilization ratio is generally better for your credit score.5
If you can pay down your credit card debt faster, you'll further lower your credit utilization, which will help your credit. But if you get into the habit of overspending on your new credit card, your credit utilization will creep back up and hurt your credit score.
How long does a balance transfer take?
Balance transfers can take anywhere from two days to six weeks, depending on the credit card companies involved.3
What happens if I don't pay off the balance in time?
If you don't pay off the balance before the promotional period on a balance transfer credit card ends, the regular APR applies, which can result in higher interest charges.
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