The basic steps for a balance transfer

A balance transfer moves debt from one credit card to another, usually one with a lower interest rate. You contact the new card issuer, give them your old card details and the amount you want to move, and they pay off that balance on your behalf. The debt then appears on your new card's bill instead.

The process typically takes 5 to 14 business days from the time you request it. During that window, you may see the balance on both cards — the old one and the new one — before the old card's balance drops to zero. Keep making minimum payments on the old card until the transfer clears, because the issuer still owns that debt until the new card issuer has actually paid it.

Most balance transfers come with a fee of 3 to 5 percent of the amount you move. Some cards waive the fee for transfers completed within the first 60 or 90 days of opening the account. The fee gets added to your new card's balance, so factor that into your math when deciding whether the lower interest rate is worth it.

Key Takeaways

  • You initiate a balance transfer by calling the new card issuer or logging into their website and requesting the transfer, then providing your old card number and the amount.
  • The transfer takes 5 to 14 business days to complete, and you should keep paying the old card until it shows a zero balance.
  • Balance transfer fees are usually 3 to 5 percent of the amount moved and are added to your new card's balance.
  • The new card's interest rate applies only during the promotional period, which typically lasts 6 to 21 months depending on the card.
  • After the promotional period ends, any remaining balance reverts to the card's regular interest rate, which is often higher than your original card's rate.

Where to find the balance transfer option

If you already have the new card, log into your online account or call the customer service number on the back of the card. Look for a section labeled "Balance Transfer," "Transfers," or "Move a Balance." Some issuers put this under "Manage Your Account" or "Services." The option is usually available within the first few clicks.

If you do not yet have the new card, you can request a balance transfer as part of the application process. Many card issuers let you enter the old card details and transfer amount before you finish applying. This can speed things up because the transfer request is already in the system when your new card is approved.

You can also call the card issuer's customer service line and ask to speak with someone about a balance transfer. They will walk you through what information they need and confirm the fee and promotional interest rate before the transfer goes through.

What information you will need to provide

Have your old credit card number ready, or the account number if the card is no longer in your possession. You will also need to know the balance you want to transfer — you can transfer part of the balance or all of it, but the issuer may have a minimum (often $100) and a maximum (often your new card's credit limit).

The issuer will ask for the name on the old account and may ask for the old card's expiration date or CVV. If you are transferring a balance from a debit card or bank account, you will need the routing number and account number instead. Have your current address handy as well, though the issuer usually has this on file already.

Some issuers ask whether you want the new card's promotional interest rate to apply to the transferred balance or only to new purchases. If you are doing a balance transfer, you almost always want the promotional rate on the transferred balance — that is the whole point. Confirm this before submitting the request.

Understanding the promotional period and what happens after

The promotional interest rate — often 0 percent — applies only for a set number of months. This period varies widely: some cards offer 6 months, others offer 12, 18, or even 21 months. The longer the period, the more time you have to pay down the balance before interest kicks in. Check the card's terms before you transfer, because this number is not negotiable once you have applied.

When the promotional period ends, any balance remaining on the card reverts to the card's regular purchase interest rate. This rate is often 15 to 25 percent, which may be higher than the rate on your original card. If you have not paid off the transferred balance by the time the promotion expires, you will start paying interest on whatever is left.

Mark the end date of the promotional period on your calendar and work backward to figure out how much you need to pay each month to clear the balance before that date. If the math does not work — if you cannot pay it off in time — a balance transfer may not save you money.

Avoiding common mistakes during a balance transfer

Do not close the old card immediately after the transfer clears. Closing it can hurt your credit score because it reduces your available credit and shortens your credit history. Leave the account open with a zero balance for at least six months, then decide whether to close it based on whether you use it or whether it has an annual fee.

Do not make new purchases on the new card during the promotional period unless the card also offers a 0 percent rate on purchases. If it does not, new purchases will accrue interest at the regular rate right away, even while your transferred balance is interest-free. Keep the new card for the transfer only, and use a different card for everyday spending if possible.

Do not miss a payment on the new card. Most issuers will end the promotional interest rate immediately if you pay late, and your balance will start accruing interest at the regular rate. Set up automatic payments for at least the minimum, or set a phone reminder for the due date.

When a balance transfer makes financial sense

A balance transfer saves you money only if the interest you avoid during the promotional period is more than the transfer fee. For example, if you transfer $5,000 at a 4 percent fee ($200) and your old card charges 20 percent interest, you save roughly $1,000 in interest over 12 months — so the transfer is worth it. But if you transfer $500, the fee is $20 and your interest savings might be only $50, making the transfer less valuable.

A balance transfer also makes sense if you have a concrete plan to pay off the balance before the promotional period ends. If you are just moving debt around without reducing it, you will end up paying more in the long run because the regular interest rate on the new card may be higher than your original rate.

If your old card's interest rate is already low — under 10 percent — or if you can pay off the balance in a few months without a transfer, the fee may not be worth it. Use a calculator to compare: (transfer fee) versus (interest saved during the promotional period). If the savings are less than $50 or $100, the transfer probably is not worth your time.

Frequently Asked Questions

Can I do a balance transfer if I have bad credit?

Balance transfer cards usually require fair credit or better, which means a score around 650 or higher. If your score is lower, you may not be approved for a card with a promotional rate. Some issuers offer balance transfer options to customers with lower scores, but the promotional period is shorter and the fee is higher. Call issuers directly to ask about their minimum credit requirements before you apply.

What happens if I transfer a balance and then the card issuer closes my account?

If the issuer closes your account, the promotional interest rate usually ends immediately and the remaining balance reverts to the regular interest rate. This is rare, but it can happen if you miss payments or if the issuer suspects fraud. To avoid this, make all payments on time and do not use the card for anything other than the transferred balance.

Can I transfer a balance from one card to the same card?

No. You cannot transfer a balance from a card to itself. You must transfer to a different card from a different issuer. If you want to move a balance within the same issuer — for example, from one Chase card to another Chase card — some issuers allow this, but you should call and ask first because policies vary.

Does a balance transfer hurt my credit score?

A balance transfer will temporarily lower your score because the issuer runs a hard inquiry and opens a new account. Your score usually recovers within a few months. Over time, the transfer can help your score if it lowers your credit utilization ratio — the amount of credit you are using compared to your total available credit.

Can I transfer a balance if I am behind on payments?

Most issuers will not approve a balance transfer if you are currently late on the old card. You need to bring the account current first, then wait at least 30 days before applying for a new card. If you are struggling to catch up, contact your current issuer about a hardship program or payment plan before pursuing a balance transfer.