What happens when you transfer a balance
A balance transfer moves debt from one credit card to another, usually one with a lower interest rate. You request the transfer from the new card's issuer, they pay off the old card's balance, and you then owe that amount to the new card instead. The goal is to reduce the interest you pay while you work down the debt.
Most balance transfer offers come with a temporary lower rate — often 0% for a set period, typically 6 to 21 months depending on the card and issuer. After that period ends, the regular interest rate kicks in. You will also pay a balance transfer fee, usually 3% to 5% of the amount you move, charged upfront.
Balance transfers work best if you have a concrete plan to pay down the debt during the low-rate period. If you simply move the balance and keep spending, you end up with more debt spread across two cards.
Key Takeaways
- A balance transfer moves your debt to a new card, usually with a lower interest rate for a limited time, but you pay an upfront fee of 3% to 5%.
- You must have a credit score in the good to excellent range (typically 670 or higher) to be approved for a card with a favorable balance transfer offer.
- The math only works if you pay down the balance during the low-rate period; after it ends, interest charges resume at the card's regular rate.
- You can transfer from any card to any other card, but you cannot transfer a balance to the same card you already have.
Check your credit score and find cards with low introductory rates
Before you start, pull your credit report from AnnualCreditReport.com, the only site authorized by federal law to provide free reports. You do not need to buy a score; most card issuers publish the score range they target, and you can compare your own estimate against those ranges.
Cards with 0% balance transfer offers typically require a credit score of 670 or higher, though some issuers accept scores as low as 650. If your score is below 650, a balance transfer may not be available to you right now. In that case, focus on paying down the existing balance at its current rate, or look for a card with a higher acceptance threshold and a smaller introductory discount.
Once you know your score range, search for cards that offer both a 0% introductory period and a low balance transfer fee. The fee matters: a 5% fee on a $5,000 transfer costs $250, so a card with a 3% fee saves you money even if the introductory period is slightly shorter. Compare the total cost, not just the rate.
Calculate whether the transfer saves you money
The balance transfer only makes sense if the fee plus the interest you will pay during the introductory period is less than the interest you would pay on the old card. Here is the math:
Suppose you owe $5,000 at 22% interest on your current card, and you find a new card offering 0% for 12 months with a 3% fee. The fee is $150. If you make no payments, you would owe $5,150 after 12 months on the new card. On the old card at 22%, you would owe roughly $6,100 after 12 months. The transfer saves you about $950, minus whatever you actually pay down during those 12 months.
But if you can only afford to pay $100 a month, you will pay down $1,200 of the $5,150 balance during the 12-month period, leaving $3,950 still owed when the 0% rate expires. At that point, interest charges resume. If the new card's regular rate is also 22%, you have not solved the problem — you have only delayed it. The transfer is worth doing only if you have a realistic plan to pay the balance to zero (or close to it) before the introductory period ends.
Request the transfer from the new card issuer
Once you have chosen a card and been approved, contact the issuer to request the balance transfer. You can usually do this online through your new account, by phone, or through the card's mobile app. You will need the account number and balance of the card you are transferring from.
The issuer will ask you how much to transfer. Do not transfer more than you owe on the old card, and do not transfer your entire credit limit on the new card — doing so will hurt your credit score by raising your credit utilization ratio. A good rule is to transfer no more than 30% of the new card's credit limit.
The transfer itself usually takes 5 to 14 business days. During that time, keep making minimum payments on the old card so you do not fall behind. Once the transfer posts to the new card, you can stop paying the old card (though you may want to keep it open with a zero balance to preserve your credit history).
Understand what happens after the introductory period ends
Mark the date when the 0% period expires on your calendar. On that date, any remaining balance will begin accruing interest at the card's regular rate, which is usually printed in the card's terms or shown in your account.
If you still owe money when the period ends, your monthly payment will jump significantly because interest charges resume. For example, if you owe $2,000 when a 12-month 0% period expires and the regular rate is 20%, you will suddenly owe roughly $33 in interest that month alone. This is why the transfer only works if you have a plan to pay down the balance before the period ends.
Some issuers offer a second balance transfer offer after you have paid down the first one, but do not count on it. Treat the introductory period as your window to eliminate the debt.
Avoid common mistakes during the transfer period
The biggest mistake is continuing to use the new card for new purchases while you are paying down the transferred balance. New purchases usually accrue interest immediately at the regular rate, even during the 0% period. If you charge $500 in new purchases, you will owe interest on that $500 from day one, separate from the transferred balance.
Another mistake is missing a payment. If you miss even one payment during the introductory period, many issuers will cancel the 0% offer and apply the regular rate to the entire balance immediately. Set up automatic payments for at least the minimum, and ideally for a fixed amount each month that will get you to zero by the time the period ends.
Do not close the old card immediately after the transfer posts. Closing it will lower your available credit and raise your utilization ratio, which damages your credit score. Leave it open with a zero balance.
Frequently Asked Questions
Can I transfer a balance from one card to the same card?
No. You cannot transfer a balance to a card you already own. The transfer must go to a different card from a different issuer, or in some cases a different product from the same issuer (such as moving a balance from a regular card to a rewards card).
What if I cannot pay off the balance before the 0% period ends?
Interest will resume at the regular rate on whatever balance remains. If you are close to paying it off, you might request a second balance transfer to another card with a 0% offer. However, each transfer costs a fee and requires a new application, so this strategy only works if you are genuinely making progress on the debt.
Does a balance transfer hurt my credit score?
Yes, temporarily. The new credit inquiry and new account will lower your score by a few points. However, the transfer also lowers your utilization ratio on the old card (since the balance drops to zero), which helps your score. The net effect is usually a small dip that recovers within a few months if you make on-time payments.
Can I transfer a balance if I am behind on payments?
Most issuers will not approve a balance transfer if you are currently delinquent. You will need to bring the account current first. If you are struggling to make payments, a balance transfer may not be the right solution — consider contacting your current issuer about a hardship program instead.
What is the difference between a balance transfer and a cash advance?
A balance transfer moves debt from one card to another and usually qualifies for the introductory 0% rate. A cash advance is when you withdraw cash from your credit card, and it charges interest immediately at a higher rate with an upfront fee. They are different transactions with different costs.