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What Is a Balance Transfer Intro APR and How Do You Know if It’s Good?

Find out what a balance transfer intro APR means and how to tell if it's a good deal.
By: Suleman Anwer
Credit Cards - General
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Wondering what a balance transfer intro APR means?

A balance transfer is a credit card transaction that lets you transfer a high-interest debt from one credit card account to another. 

The interest rate you pay to credit card companies on this transfer is called a balance transfer APR (annual percentage rate). 

But why move a high-interest debt from one credit card to another if you’re still paying an interest charge?

This is where balance transfer intro APR comes into play. 

Moving your credit card debt to a balance transfer card with a 0% introductory APR offer can help save thousands of dollars in interest. 

If you’re looking to do a balance transfer, you may have questions like ‘what is balance transfer intro APR?’ or ‘is an intro APR balance transfer offer a good deal?’. 

Don't worry, we’ve got you covered.

In this article, we’ll discuss what a balance transfer intro APR means and six factors that determine if it’s a good deal. We’ll also discuss three quick tips to maximize your intro APR and highlight some of the best balance transfer credit cards

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Let’s get started.  

What is Balance Transfer Intro APR?

An introductory balance transfer APR is a set time frame, usually ranging from six and 18 months, where the APR for your balance transfer is very low or even 0%. 

This balance transfer intro APR is a temporary promotional interest rate that gives you an easier and potentially interest-free way to reduce or pay off your credit card debt. 

Although you’ll still need to make the monthly minimum payments on your credit card balance, your existing debt won’t accumulate new interest during this promotional period.

How Does a Balance Transfer Intro APR Work?

Let’s discuss how a balance transfer intro APR works using an example. 

Let’s say a cardholder has a $6,000 credit card balance on card A, with an 18% balance transfer APR and a 3% balance transfer fee. 

With monthly payments of $344, the cardholder can pay off this credit card balance in approximately 18 months. However, they’d pay an additional $1080 in interest because of the balance transfer APR.

Alternatively, let’s say the same cardholder transfers the $6,000 balance to a new credit card with a balance transfer intro APR offer of 0% for 18 months. In this case, the credit card balance transfer can save the cardholder approximately $1080 in interest. 

It’s clear that a balance transfer intro APR can help you save big on the interest charge levied by credit card companies. 

But is it the right offer for you? 

Read on to find out. 

Is an Intro APR a Good Deal?

Whether a balance transfer intro APR offer is a good deal depends on your financial situation. 

Here are six key factors to consider before choosing a balance transfer card with an intro APR:

1. Availability of a 0% Intro APR Offer

A credit card issuer decides the balance transfer intro APR offer. 

While some cards offer a 0% intro APR, others offer a low intro APR of 3% to 6%. The balance transfer card offers you qualify for usually depend on your creditworthiness. 

2. Length of Introductory Period 

The length of the Introductory APR period varies based on the credit card issuer and your creditworthiness. 

Depending on your financial situation and the amount of debt, you may need a long intro period. It’s important to find the right balance transfer card that serves your needs. 

3. Regular Balance Transfer APR

After the intro APR period, a higher interest rate called the regular balance transfer APR would typically kick in.

That’s why it’s crucial to read the card’s terms and conditions carefully to understand the APR that’ll replace the intro APR offer. 

Note that credit card companies are obligated to tell you how long the introductory APR will last and which APR applies after the intro period ends.

4. Balance Transfer Limit

You may want to use your balance transfer credit card to consolidate all your credit card debt into one account or transfer a large balance. 

In such financial situations, the balance transfer limit set by the card issuer becomes critical. 

Typically, the entire balance transfer amount can’t exceed your credit limit. While one card issuer may let you transfer a balance that’s equal to your credit limit, another card issuer may let you transfer only a percentage of your credit limit.

5. Balance transfer fees

When transferring a balance to a new credit card, the new card issuer may levy a balance transfer fee. The balance transfer fee can range from 2% to 5% of the transferred balance amount. 

Note that some balance transfer cards charge a 0% balance transfer fee. 

6. Credit Card Rates and Fees

Ideally, you should look for a 0% intro APR offer and a low balance transfer fee to find the best balance transfer credit card. 

But beyond a great balance transfer offer, you should also consider any other fees charged by the credit card issuer.

These credit card rates and fees include the annual fee, interest rate on any new purchase, foreign transaction fee, and a late payment fee. 

Even though you’re focusing on the card for its balance transfer APR offer, you’ll likely continue using the card after you’ve paid your balance off. As a result, it’s important to also consider the APR on cash advances, statement credit offers, and other card benefits when applying for one.

Now, how can you make the most of your intro APR?

3 Quick Tips to Maximize the Balance Transfer Intro APR 

Here are three simple tips to help you make the best of your balance transfer intro APR offer: 

1. Use Card to Only Pay Credit Card Debt 

Use your balance transfer credit card only to handle your credit card debt. 

Using your balance transfers to make new purchases may not be a smart move, even if your card doubles up as a cash back card. 

The only exception is if your card also has an intro APR offer on a qualifying purchase. 

Remember, an intro purchase APR only offers a low or 0% APR on a qualifying purchase and is different from balance transfer intro APR.

It’s best to use a different cash rewards credit card to handle a new purchase and earn rewards.

2. Make Timely Payments 

To make the best use of a balance transfer card’s intro APR offer, you should ideally pay off your credit card debt within the introductory offer time frame. 

This way, you can clear your debt with no or a low-interest charge. 

You can also set up an automatic payment to avoid missing monthly minimum payments

3. Practice Debt Consolidation

If you have debt on multiple credit cards, you can use your balance transfer card to transfer your debt to one card account. Consolidating your debt in this manner can help track and regularly pay off your monthly credit card bills.

Let’s now look at some of the best balance transfer credit cards you can use to clear your balance. 

4 Great Balance Transfer Credit Cards 

Here are four great balance transfer credit cards you can consider to clear your high-interest credit card debt:

Suppose your primary goal is to use the balance transfer card to fund a qualifying purchase with their introductory APR rates on purchases. In that case, you can also consider a flat-rate rewards card or a cash back card like Wells Fargo Active Cash℠ Card.

Note: To qualify for the best credit cards with a great balance transfer offer, such as Citi Double Cash Card, Citi Custom Cash Card, etc., you’ll typically need a Good to Excellent credit score and good credit history. 

A score of 690 and above is considered a Good to Excellent credit score. Although some balance transfer credit cards are available for cardholders with Fair credit, these usually don’t have a great balance transfer offer. 

Final Thoughts

A balance transfer intro APR is a great option for people looking to fast track
debt repayment and save big on an interest charge. This is especially true if you have some high-interest credit card debt that you’ve been struggling to clear.

However, using balance transfer card memberships with an intro APR offer may not be the right move for everyone. 

Before applying or committing to a balance transfer card membership, you should ideally calculate how much money you can save and the amount of debt you can clear within the promotional APR period. 

You can go over the six factors we’ve listed to determine if a balance transfer intro APR is a good deal for you. You can also check out our list of the best balance transfer cards to learn more.

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