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Are Balance Transfer Credit Cards Good or Bad?
As explained in a previous post What are Balance Transfer Credit Cards, balance transfers can be a very good thing. They can allow you to pay off debt without continuing to get hit with interest charges which can rack up very quickly. They can also be good if you transfer your debt to a card with a lower interest rate after the promotional period is up. For an example, you currently have a card with an 18% APR Interest rate. You do a balance transfer to another card that offers 0% APR for 18 months. After the 18 months is up on the 0% APR Balance Transfer, the card then has a 16% APR Interest Rate. This is a whole 2% better than the previous card you had before the Balance Transfer at 18% APR.
Also, the longer the promotional offer of 0% APR Interest, the more time you have to pay off your debt. Any amount of extra time you can get to pay off debt without having to pay interest is a win win situation.
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Now you want to know the other part of Are Balance Transfers Good or Bad?
They can be very bad if you end up accumulating more debt and you are unable to pay it off before the promotional period ends. This can get you in a lot of trouble. Which is why we highly recommend using 0% Balance Transfer Offers as a tool to only pay off debt, not to acquire more debt. This can especially be the case if the APR is higher than the APR from the account you transferred the debt from.
Also, be careful of any Transfer Fees. These can generally be between 3% and 5%. These are typically one time fees. Just make sure its worth paying this fee based on the amount of debt you have and how quickly you can pay it off. Although we have found some offers with No Balance Transfer Fees. See link below.
Check our our Current Listing of the Longest 0% Interest APR Credit Card Offers with No Balance Transfer Fee
They can also be bad if your FICO Credit Score is not considered good. Most companies will only approve you for Longer 0% Interest APR Balance Transfer Offers if you credit score is above 675. We say this is bad because if your score is below 675 then you more than likely will be stuck with your current interest rate. If this is the case, try to focus on raising your credit score to above 675.
One question you may be asking yourself is will a Balance Transfer affect my FICO Credit Score. Our experts have the answer to this question and more in our article titled: Will it Hurt my FICO Credit Score If I Do a Credit Balance Transfer? Review
With this information and some quick number crunching you should have a good idea of: Are Balance Transfer Credit Cards Good or Bad?
See our summary below and be sure to leave us your comments to this article. Our experts generally get back to you within 24 hours.
Whether you are looking for a break from current interest rates with a 0% APR for only 6 months or up to 18 or 21 months, you will find our current offers here.
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Summary: Are Balance Transfer Credit Cards Good or Bad?
With the amount of debt piling up today, Balance Transfer Credit Cards can be a good way to relieve you from interest payments temporarily. With the proper money management skills and being diligent about paying off debt we find most Balance Transfer Credit Cards to be a good way to manage your debt.
Balance Transfer Credit Cards can be good if you properly manage your debt. We recommend using these offers to pay your debt down or pay your debt off completely. Do not use these to acquire more debt that you will not be able to pay off.
More Related Articles to: What Are Balance Transfer Credit Cards? And Are Balance Transfers Good or Bad?
Check our our Current Listing of the Longest 0% Interest APR Credit Card Offers with No Balance Transfer Fee
Whether you are looking for a break from current interest rates with a 0% APR for only 6 months or up to 18 or 21 months, you will find our current offers here.
*Disclaimer: BestPrepaidDebitCards.com is an independently owned and operated, advertising-supported financial product comparison service. Many of the credit card offers that appear on linked sites are from companies from which BestPrepaidDebitCards.com receives compensation.