How to Transfer a Credit Card Balance – Transferring your credit card balance

A credit card balance transfer can be a strategic move to manage and pay down existing debt, especially high-interest balances.¹ It involves moving debt from one or more existing credit accounts (often other credit cards, but in some cases, even personal loans or other types of loans, depending on the issuer) to a new credit card.² The primary appeal lies in the potential to save money on interest through a lower, often 0%, introductory APR for a fixed period.³

How a Balance Transfer Works

When you transfer a balance, more of your monthly payments can go towards your principal balance, rather than being consumed by interest charges.⁴ If you manage to repay the entire transferred balance within the introductory period, you can effectively avoid accruing any new interest on that debt.

Determining if a Balance Transfer is Right for You

To decide if a balance transfer is a suitable debt management solution, consider your financial situation:

Credit Score: A strong credit score generally increases your likelihood of qualifying for the most attractive offers, including longer 0% introductory APR periods and lower regular APRs. If you have a lower credit score, you might still qualify, but the terms may be less favorable.
Ability to Pay: Be realistic about your ability to pay off the transferred balance within the promotional period. Calculate the minimum monthly payment required to achieve this goal. If you struggle to make minimum payments, have maxed-out cards, or have past-due payments, a balance transfer might not be the best solution, and other debt relief options might be more appropriate.
Balance Transfer Fees: Most credit card issuers charge a balance transfer fee, typically a percentage of the transferred amount (e.g., 3-5%) or a flat fee.⁵ It’s crucial to weigh this cost against the potential interest savings to ensure the transfer is financially beneficial.
Standard APR After Intro Period: Understand that the low or 0% APR is temporary. Any outstanding balance remaining after the promotional period ends will accrue interest at the new card’s standard APR, which can be considerably higher.⁶

How to Transfer a Balance

Choose an Offer and Apply: Select a balance transfer offer that aligns with your debt amount and repayment timeline. Apply for the new credit card.
Request a Balance Transfer: Once approved, you can typically request the balance transfer through the card issuer’s online banking, mobile app, or by contacting customer service.⁷ You’ll need the account information (account number, amount) for the existing debts you wish to transfer.
- Prioritize High-Interest Debt: If your new card’s credit limit isn’t high enough to cover all your high-interest debt, prioritize transferring the balances with the highest interest rates first.⁸
Continue Making Payments on Old Accounts: Balance transfers do not happen instantly.⁹ They can take anywhere from two days to six weeks to process, depending on the issuer.¹⁰ During this time, continue making all minimum payments on your old accounts until you verify that the funds have been successfully posted to them and the transferred balance appears on your new account.
Follow Up on Your Request: Monitor both your old and new accounts to ensure the transfer completes as expected. Pay off any residual interest that might accrue on the old account between the request date and the completion date.
Pay Down the New Balance: To maximize interest savings, aim to pay off as much of the new balance as possible before the promotional rate expires. This usually means paying more than the minimum monthly payment. For example, if you transfer $5,000 to a new card with an 18-month 0% intro rate and a 3% fee (totaling $5,150), you’d need to pay approximately $287 monthly to clear it within 18 months, assuming no new purchases.

Discover Balance Transfer Specifics:

For Discover Card balance transfers, a new account must be open for 14 days before Discover can begin processing the request.¹¹ After this initial waiting period, most transfers are processed within 4 days. However, it may take additional time for the credit to appear on the account from which you’re transferring the balance.

The Bottom Line

Credit card balance transfers can be a valuable tool for debt consolidation and interest savings if approached with careful planning and disciplined repayment.¹² By understanding how they work, weighing the pros and cons (including fees and the temporary nature of promotional rates), and diligently paying down your balance, you can leverage a balance transfer to make your debt repayment journey easier and more efficient. Remember that you cannot typically transfer balances between cards from the same issuer. Also, while some issuers allow transfers from other loan types, it’s essential to confirm this with the specific card provider.