What is a Balance Transfer Credit Card and Do You Need One?

Balance transfer credit cards have several benefits, including the potential to save on interest charges and help with debt consolidation.
Updated Dec. 5, 2023
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Balance transfer cards are credit cards that let you bring over a balance from a different, high-interest credit card. Getting out of debt can be challenging, but balance transfer cards generally have low introductory rates that help you save on interest while you focus on repayment.

As long as you pay off the balance on your balance transfer card before the introductory period ends, it’s possible to save a lot of money this way. Watch out though — if you don’t pay it off before the balance transfer offer ends, you could end up spending more money, not less. Make sure you’re paying more than the minimum payment.

In this article

How do balance transfers work?

A balance transfer is the process of moving an outstanding debt from one credit card account to another. People often transfer balances because it can save them money. The receiving account might have a lower annual percentage rate (APR) than the one from which the debt was transferred, which makes the transfer worthwhile.

If you have thousands of dollars in debt, going from a double-digit APR to one that is very low — or even zero — can save you hundreds of dollars over time.

What is a balance transfer credit card?

A balance transfer credit card is one that behaves much like other credit cards. The biggest difference is that balance transfer credit cards come with special intro offers depending on the credit card issuer. Namely, they have a balance transfer APR that is much lower than the average credit card APR. In some cases, the APR for balance transfers will be 0% during the introductory period from the lender.

When you transfer a balance from your existing credit card company to a balance transfer credit card, you are able to take advantage of the new credit card’s low APR. Keep in mind, though, that transferring a balance does not automatically close the old credit card. Any outstanding balances on the old credit card will continue to accumulate interest.

Balance transfer cards often have 0% APR during the introductory promotional period, but they may have a high variable APR after the intro offer ends. That’s why it’s really important to pay off the transferred balance before the introductory period ends — otherwise, you could be hit with a high APR again.

How much are balance transfer fees?

Although balance transfer credit cards often have 0% APR for a limited period of time on the amount you transfer, there can be fees for the transfer itself. For example, compare credit cards often used for balance transfers:

  • Chase Freedom Flex℠: $5 or 3%, whichever is greater, on transfers made within the first 60 days of account opening; after that, $5 or 5%, whichever is greater.
  • Citi Double Cash® Card: 3% of each balance transfer ($5 minimum) within 4 months of account opening; then 5% of each transfer ($5 minimum) after the 4 month intro period ends.
  • Capital One Quicksilver Cash Rewards Credit Card: 3% fee on the amounts transferred within the first 15 months (or at a promotional APR that Capital One may offer you at any other time; No fee for amounts transferred at the Transfer APR).
  • Chase Slate Edge℠: $5 or 3% of the amount of each transfer, whichever is greater in the first 60 days.

Balance transfer cards are often still subject to typical fees as well, such as late fees.

How long does the introductory APR for balance transfers last?

Balance transfer credit cards have an introductory period that must last for at least six months, unless you are more than 60 days late on a payment. However, some balance transfers may have introductory periods lasting 15 months or longer. Since the actual length varies by credit card, check your cardholder terms and conditions to find out how long the introductory period lasts.

How much could I save from a balance transfer?

How much you could save depends on several factors, but primarily on the amount you transfer and your current APR.

While balance transfers do come with fees, you’ll still likely save money. This is because balance transfer fees are usually 3% to 5% — much lower than most credit cards’ normal APRs. As long as you don’t carry a balance on the balance transfer credit card beyond the introductory period, you’ll still likely save money over time.

For example, here is a comparison of the interest and fees on a balance transfer credit card versus the old credit card. In this scenario, the balance on the new credit card is paid off in 12 months. This assumes a 12-month introductory period with 0% APR for the balance transfer card:

Old credit card Balance transfer credit card
Starting balance $5,000 $5,000
APR 15% 0% (12-month intro rate)
Monthly payment $475 $475
12-month interest $395.10 $0
Balance transfer fee N/A $150
Total interest/fees $395.10 $150

In this example scenario, you would save $245.10 by transferring the balance to the new credit card. This assumes no additional charges on the balance transfer card in the first year and that you continue to make $475 payments every month.

Will getting a balance transfer hurt my credit score?

A balance transfer will not hurt your credit score in most cases. However, it can lower your credit score if it increases your credit utilization ratio. It can also cause changes to your credit history that might affect your score.

For instance, opening a balance transfer credit card may result in a hard credit inquiry, which usually causes a temporary drop in your credit score. However, hard inquiries don’t stay on your credit report forever, and their effect on your credit score tends to lessen over time.

Even if a balance transfer results in a temporary drop in your credit score, it can still help you raise your score overall. If you reduce your credit utilization rate and you continue to make on-time payments, a balance transfer card could help you work toward a good credit score.

Can I use a balance transfer credit card for other things?

Yes, you can use a balance transfer credit card for anything you could buy with a normal credit card. The main difference is that balance transfer credit cards have an introductory period with a low balance transfer APR.

In fact, there are many credit cards with nice benefits for new purchases that also have introductory periods with 0% balance transfer APR. These credit cards also have benefits for purchases:

  • Citi Double Cash® Card: Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases; plus, for a limited time, earn 5% total cash back on hotel, car rentals and attractions booked on the Citi Travel℠ portal through 12/31/24.
  • Chase Freedom Flex℠: Earn 5% cash back on rotating quarterly categories you activate (on up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal; 3% cash back on drugstore purchases and dining at restaurants (including takeout and eligible delivery service); and 1% cash back on all other purchases. 0% intro APR on purchases for 15 months, then 20.49%-29.24% Variable APR.
  • Capital One Quicksilver Cash Rewards Credit Card: Earn 1.5% cash back on every purchase, every day; and 5% cash back on hotels and rental cars booked through Capital One Travel (terms apply). 0% intro APR on purchases for 15 months, then 19.99% - 29.99% (Variable) APR.

While you can use your balance transfer card to buy new things, it’s generally good practice to pay off the balance as quickly as possible. That way, you can avoid accumulating interest on the balance transfer card, which could wipe out some or all of the savings you’d get from the original transfer.

What are the downsides of opening a balance transfer credit card?

Balance transfer credit cards have lots of potential benefits, but there are some potential downsides you should keep in mind before opening one. Keep these in mind so you can make the appropriate preparation before opening a new card.

One downside is that you can expect a hard credit inquiry on your credit report whenever you open a new credit card, including balance transfer cards. Credit scores have several factors, but hard inquiries generally cause a small drop in your credit score.

You might see a slight dip in your credit score after opening a balance transfer card. Hard inquiries are not permanent, and their effect on your credit score tends to lessen over time. Still, it’s something to keep in mind, especially if you are about to apply for a big loan, like a mortgage.

The other downside is the potential to accrue more debt. As mentioned, balance transfer cards sometimes have attractive benefits for purchases that can make them tempting to use. If you rack up more charges on the card and fail to pay it off, it could end up compounding your debt instead of helping you get out of it.

What are some recommended balance transfer credit cards?

People can have different reasons for choosing balance transfers, such as consolidating debt, paying off debt, or both. In general, though, what you want to look for is a lengthy introductory period with a low APR (ideally 0%).

Having a lengthy 0% introductory period will hopefully give you enough time to pay the card off so you can avoid paying interest on the balance.

Here are a few of the recommended balance transfer credit cards and how they compare:

Card name Annual fee Intro APR period Intro balance transfer APR Regular APR Other benefits
Capital One Quicksilver Cash Rewards Credit Card
$0 15 months 0% intro APR 19.99% - 29.99% (Variable) Unlimited 1.5% cash back
Citi Double Cash® Card $0 18 months 0% intro APR 19.24% - 29.24% (Variable) 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases; plus, for a limited time, earn 5% total cash back on hotel, car rentals and attractions booked on the Citi Travel℠ portal through 12/31/24
Chase Slate Edge℠
$0 18 months 0% intro APR 20.49% - 29.24% Variable Considered for an annual 2% APR decrease
Wells Fargo Active Cash® Card $0 15 months from account opening on qualifying balance transfers 0% intro APR 20.24%, 25.24%, or 29.99% Variable Earn 2% cash rewards on purchases

We also recommend the Discover it® Balance Transfer, which has a $0 annual fee and an intro APR on balance transfers and purchases. Cardholders can earn 5% cash back in quarterly rotating categories (up to quarterly maximum, once activated) and 1% cash back on all other purchases.


Can I still use my credit card after a balance transfer?

Yes, a balance transfer card is the same as any other credit card in most respects, so you can still use it as you normally would after a balance transfer. However, it is generally best to pay the card off before making additional purchases if your goal is eliminating credit card debt.

What’s the difference between a balance transfer and a credit card?

A balance transfer is the process of moving debt from one account to another, and some credit cards are well suited to this kind of transfer. However, not all credit cards have low introductory APR offers, so they aren’t ideal for balance transfers.

Can I get cash back on a balance transfer?

Balance transfers are separate from purchases, including separate APRs, credit limits, and fees. Usually, balance transfers don’t earn cash back, even if the credit card accumulates cash back on regular purchases.

Bottom line

Balance transfer credit cards allow you to transfer high-interest debt from one or more old cards to a new credit card with a lower interest rate. Balance transfer cards usually have an introductory period with a low or 0% APR, making them ideal for consolidating and paying off credit card debt.

Balance transfers can save you money and usually won’t hurt your credit in the long term, assuming you pay off the balance on the new card. You can also use them for other things — but ideally, you should pay them off first so you don’t end up with even more debt.

Extra Long Intro APR on Purchases & Balance Transfers


Wells Fargo Reflect® Card

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Benefit from a long introductory APR period on purchases and qualifying balance transfers

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Author Details

Bob Haegele Bob Haegele is a seasoned personal finance writer, leveraging his bachelor's degree in information technology from Marquette University to dissect complex financial topics.

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