Applying for a balance transfer card: top tips

Applying for a balance transfer card: top tips
Written by Mark Grimley
Published on 5th July 2017
Updated on 10th December 2019
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Find the best card for you

If you’re juggling several credit or store cards and have built up debt with a high rate of interest then a balance transfer card can help you repay this debt sooner. With providers offering low rates of interest or even 0% interest for a specified period, this can save you hundreds, or even thousands of pounds in interest repayments over the term of your loan. So switching your credit card debt to a balance transfer card can be a savvy financial move and here at Choose Wisely we have some top tips to consider when you apply.

Check your credit score

A less than healthy credit score can make it hard to be accepted for cards with the best interest rate offers, and each application you make marks your credit score. Check your credit rating for free using Credit Karma or ClearScore and use our comparison chart to check which card will most suit you.

Find Loans

Use the Choose Wisely Eligibility Checker to find a suitable lender in just a few minutes, without impacting your credit score.

Beware headline deals

Providers will always show you their best deals, but these are reserved for customers with the best credit rating so you may not get a 0% rate or you may be offered fewer months than advertised. For example, you could apply for a 0% over 36 months credit deal but only be offered 0% at 20 months. It’s sometimes worth asking your existing credit cards provider if they have any cheap deals on offer as then you can start shifting the debt around. Even if they don’t have any deals on offer, but you have several credit cards then it’s always worth pushing as much of your debt as possible onto the card with the lowest interest rate. Remember that most lenders will charge you a small fee to switch your debt. This is usually between 2.5% and 3% which still makes it a good proposition for quicker repayment of your debts.

Always clear the debt before the 0% or cheap rate ends

As much as 0% deals are enticing, they are designed to make the lenders money by charging massive interest rates when the low rate ends, so paying it off within the offer period is really important. That way you pay no interest on the balance and can effectively enjoy an interest-free loan. If you don’t manage to pay off the debt before the low rate or 0% deal ends then look to switch to another low rate or 0% credit card. You could also switch back to one of your existing credit cards if this has a lower interest rate. The trick is to move debt to the cheapest possible interest rate and pay it off as quickly as possible.

Repay at least the set monthly minimum

As nice as a 0% deal is, it doesn’t mean you don’t have to pay anything. You must pay at least the minimum monthly repayments, otherwise, you’ll be hit with penalties and some card providers can even withdraw the deal, leaving you on an expensive rate and financially much worse off. Calculate your repayments to make sure that you pay the debt in full before the offer ends.

Don’t spend or withdraw cash

If you get the right deal then you’ll be looking at a low interest or interest-free loan on your debts. But don’t be tempted to use the credit cards towards purchases or cash withdrawals as lenders will charge you interest on this, and not usually at the cheap rate. You’ll only avoid interest if you pay off the balance in full before the offer ends.

Find credit cards for bad credit

Have bad credit? Have a look at the full range of credit cards and compare your options using a Choose Wisely comparison table.

Mark Grimley
Written by
Mark Grimley
Head of Partnerships & Take Control Author at Choose Wisely

Mark joined Choose Wisely in 2015. He continues to work in close contact with the providers, brokers and journalists operating in the world of consumer credit.