Ways to use a balance transfer card to help you manage your finances
Balance transfers
How much does a balance transfer card cost?
Who doesn’t love paying less? A balance transfer card can help you pay off your credit card balance sooner by moving what you owe to a brand new card with a lower interest rate. To move your balance, there might be a transfer fee, which is usually a small percentage of the amount you’re transferring.
To get the most from a balance transfer, you need to make at least the minimum monthly repayments and stay within your credit limit so that you can hang on to the 0% interest offer.
When is a balance transfer card worth it?
Put simply, a balance transfer is a good idea if it’s going to cost you less in the long run by moving your balance from your current credit card to a new one. This is usually the case because the balance transfer card has a 0% interest introductory period, during which you can focus just on paying off your balance, instead of worrying about the interest as well.
Balance transfer credit cards can be used to combine several outstanding balances in one place, which can simplify your payments. If the new card has a lower rate of interest or an interest-free period, combining balances could also save you money.
When making an application for a balance transfer card, you should always check if you’re likely to be accepted first to avoid hurting your credit report.
It’s important to check your credit score and use our eligibility checker to see if you are eligible for a balance transfer card before you apply. If you feel it could do with a boost, it’s worth reading up on how you can improve your credit score.
What is a balance transfer fee?
Credit card providers sometimes charge a fee for moving your balance. Fees in other aspects of life usually aren’t much fun. But if you look at the savings you could make, the fee could be more than worth it. With that said, there are some balance transfer credit cards that don’t have any fees – and who doesn’t like something for free?
Here are a few other things to consider when you’re investigating balance transfer fees:
Consider all future fees. If there’s no annual fee on a 0% balance transfer card, the transfer fee is usually the only thing you need to pay apart from clearing your balance. However, once the 0% interest period is over, interest may be added to whatever is left over on your balance. So to make the most of your balance transfer, it’s a good idea to clear your balance before that promotional period ends.
Keep your credit limit in mind. Balance transfer cards have credit limits just like any other credit card. The transfer fee usually doesn’t differ by the credit limit, but it’s still worth keeping in mind so you know you’ll be able to transfer the full amount you need to.
The maximum amount you can transfer can vary, depending on your individual credit limit and the existing balance on your Barclaycard. You’ll also need available credit left over to allow for fees, interest and future transactions.
We’ll let you know the maximum amount you can transfer if your application is successful.
Lower fees. shorter interest-free period. Some banks and cards offer lower transfer fees but it might mean the 0% interest period is shorter than on other cards.
When choosing a balance transfer card, make sure the initial balance transfer fee, the rate of interest and the length that lower rate of interest lasts suits you.
Although there are fees to consider, a balance transfer card that's used in the right way can still allow you to make big savings compared to keeping your balance on a card with interest, as there will be less to pay back in the long run.
You can use the Barclaycard transfer calculator to find out what you could save and the fee you might need to pay. To find out if you might be accepted for a balance transfer card, check out the Barclaycard eligibility checker.
How to make sure a balance transfer card works for you
Once you’ve done the sums and worked out how much a balance transfer card could save you, it’s a good idea to keep in mind how you should use the card. This way, the only fees you’ll pay are the transfer fee and annual fee, if they apply. Work through the list of considerations below to stay clued-up on the small print and use the card to your advantage.
- Be aware of how long the promotional interest rate is on offer and consider whether you can repay the balance during this period. Use our repayment calculator to find out when you could repay the balance.
- Going over your agreed credit limit or missing a payment will mean you have to pay more each month, so try to factor in those extra costs or else you could lose your interest free period altogether.
- If you can’t afford to repay the balance before the end of the promotional period, you’ll need to know the interest rate that will apply and how it could affect your future payments.
- Check what the interest rate is for new purchases on the card, as it might be different from the standard rate. Some cards offer an introductory 0% interest rate on new purchases for an agreed length of time, but others will charge a standard rate of interest on everything you buy.
- Make sure you know the fees and interest charges for taking out cash on your credit card. Most banks will charge a fee on the total amount of money withdrawn. Generally speaking, it’s best to not withdraw cash using your balance transfer card to avoid extra charges.
- You usually can’t move a balance between two cards from the same banking group, so check ahead to make sure your transfer will be possible. Some cards might look like they’re from different banks, but are actually offered by the same wider banking group, so it’s important to check.
What's next?
When you have a credit card with a balance you’d like to clear, getting a new credit card might seem a strange thing to do. But balance transfer cards are designed for exactly this situation. The 0% interest period can make clearing your balance simpler and more manageable, as long as you know upfront what payments you’ll need to make and when.
Our balance transfer calculator lets you find out how much you might be able to save by moving your balance.
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