Help me understand BT cards?

[hapagrrl]

Hi, 

I'm trying to understand balance transfers. If my current card is over-utilized at $5k, am I (potentially) app'ing for a card with a $5k limit? And the point is, I'd hopefully get a 0% rate for at least a year whilst I pay that balance down to a normal number -- right? or am I thinking about this all wrong?

[jamesdwi]

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@hapagrrl wrote:

Hi, 

I'm trying to understand balance transfers. If my current card is over-utilized at $5k, am I (potentially) app'ing for a card with a $5k limit? And the point is, I'd hopefully get a 0% rate for at least a year whilst I pay that balance down to a normal number -- right? or am I thinking about this all wrong?

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yes that is how it works but depending on the card there may be  a BT fee of 3-5%, and you most likely won't be able to max out the new card, nor should you go above 85%. 

[hapagrrl]

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@jamesdwi wrote:

yes that is how it works but depending on the card there may be  a BT fee of 3-5%, and you most likely won't be able to max out the new card, nor should you go above 85%. 

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So - if I got a new (BT) card with the same limit as my current $5k, it means I'd only be able to transfer a portion of my current balance to that hypothetical new card? 

Also - something else that's messin' with my mind: if I apply for a new card, but my util is at or near 100% - which of course brings down my score - how would I even get approved for a new card?

I'm sorry -- if I sound ditzy and confused, it's because I am! I just can't seem to understand how it all works..

[jsucool76]

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@hapagrrl wrote:

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@jamesdwi wrote:

yes that is how it works but depending on the card there may be  a BT fee of 3-5%, and you most likely won't be able to max out the new card, nor should you go above 85%. 

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So - if I got a new (BT) card with the same limit as my current $5k, it means I'd only be able to transfer a portion of my current balance to that hypothetical new card? 

Also - something else that's messin' with my mind: if I apply for a new card, but my util is at or near 100% - which of course brings down my score - how would I even get approved for a new card?

I'm sorry -- if I sound ditzy and confused, it's because I am! I just can't seem to understand how it all works..

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That is what happens. With high util your chances for approval, or approval with a usable CL decline. I got myself into some trouble about 2 years back when I was in college, and applied for a chase slate to BT some stuff. Got approved for a $500 limit, which was useless to me. 

Part of the reason I applied for the barclay ring card is that it has an 8% APR and no BT fee, so if for some reason anything happens where I need to transfer a balance, I know i can transfer to that with only an 8% APR and no BT fee.