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Balance Transfers

Use a 0% intro APR to pay down card debt faster — if the math works.

By Fountain Finances Editorial TeamUpdated

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How a balance transfer works

A balance transfer moves debt from one or more credit cards to a new card, usually one offering a 0% or low introductory APR for a set number of months. During the promotion, more of each payment goes to principal instead of interest, which can shorten payoff dramatically.

Do the math before you apply

  1. Estimate the interest you would pay on your current card over the promo period. The credit card payoff calculator can help.
  2. Calculate the transfer fee — a percentage of the amount you move.
  3. Divide the balance (plus fee) by the number of promo months to find the monthly payment needed to clear it in time.

If the fee is far less than the interest you would save and you can afford the payment, a transfer can make sense.

Rules to follow

  • Transfer quickly. Intro offers often apply only to transfers made within a set window after opening the account.
  • Don’t use the new card for purchases unless purchases also have a 0% rate; payments may be applied in ways that leave higher-rate balances outstanding.
  • Never miss a payment. A late payment can end the promotional rate on some cards.
  • Close nothing hastily. Keeping the old card open (with a zero balance) can help your utilization ratio.

Read our full guide, what is a balance transfer?, and compare widely available options in balance transfer credit cards.

Frequently asked questions

How much does a balance transfer cost?

Most balance transfer cards charge a fee, commonly a percentage of the amount transferred. Compare that one-time fee with the interest you would pay by keeping the balance where it is.

Can I transfer a balance between cards from the same bank?

Usually not. Most issuers do not allow transfers between their own cards, so you typically need a card from a different issuer.

What happens when the 0% period ends?

Any remaining balance starts accruing interest at the card’s regular APR. Plan to pay off the balance before the promotional period ends.

Part of our Credit & Credit Cards hub and our complete personal finance guide. Read our editorial standards.

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