Paying off one credit card with another?

[Mshellt]

When one card has a higher interest than another, is it a good idea to pay it off with the lower interest card? I have a care credit card that has a 0% APR for 1 yr. It is 3 months away from being completely paid off, but the promo expires next month and the interest rate will jump to 26.99%. If I pay it off with a Discover It card, the interest rate should be 0% APR with a 3% transfer fee...but I wonder if doing that will negatively affect my credit score?

[austinguy907]

People do it all the time.  As for your scores though.... that depends on how your utilization changes when you move the balance.  If you have a 5K on Discover and 10K on Care then you're utlization would double for the single account.  Does a flat 3% BT fee cost you more than the 26.99% over 3 months (0.2699/12) (0.066% * balance) ?

[Anonymous]

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@Mshellt wrote:

When one card has a higher interest than another, is it a good idea to pay it off with the lower interest card? I have a care credit card that has a 0% APR for 1 yr.

It is 3 months away from being completely paid off, but the promo expires next month and the interest rate will jump to 26.99%. If I pay it off with a Discover It card, the interest rate should be 0% APR with a 3 % tranfer fee...but I wonder if doing that will negatively affect my credit score?

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Be careful NOT to be EMOTIONAL here...and PAY ATTENTION to the NUMBERS!

This comes downs to the dollars and ents and not the hype of the words and FEELINGS....

How BIG of the balance are we talking, just how much are these 3 monthly payments that are left?

Then run the MATH....

A) The balance you'll have AFTER the last payment(b/c you said promo last 1 more month, right?)

@Anonymous we're talking 2 payments @ an APR of 26.99 ( that's 26.99/12 = `2.249% by month) vs a flat 3%

Things to consider are will you REALLY pay off over those last 2 months, will balance trasferring to Discover cause you to start

payinng a lower payment since there's NO RUSH b/c you have a year and the 3% hit has already happened (human nature, kicks in)

or do you just want to pay your last 3 and move on the other things in life?

If the chunk of balance left were HUGE it'd be a much bigger deal but we're talking 2 payments, so IMO we're using dollar time, fretting over pennies, again 2 payments and you're out (if that part is 100% true....you're wasting your time fretting over nickels.....you can always (if affordable) increase this month's payment then the 2 payments are even LESS of a balance to get rid of)

Again it's a players choice:

Ex: $1500 balance

1) Month X $500 payment....Month Y $500 payment + `2.249%....Month Z $500 payment + remaining % = PIF

2) month x same $5payment ...transfer $1000 to Discover + 3% flat (`$30)....then either payoff in 2 months or stretch out debt over MORE time

Financial difference = negligible IMO....especially if more of a payment can be made in Month X ...reducing the debt, so that the balance to retire in the following 2 months is that much smaller....so again IMO more of a 6 vs about half dozen decision, not much of a diff either way.

Good Luck

[SouthJamaica]

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@Mshellt wrote:

When one card has a higher interest than another, is it a good idea to pay it off with the lower interest card? I have a care credit card that has a 0% APR for 1 yr. It is 3 months away from being completely paid off, but the promo expires next month and the interest rate will jump to 26.99%. If I pay it off with a Discover It card, the interest rate should be 0% APR with a 3% transfer fee...but I wonder if doing that will negatively affect my credit score?

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It wouldn't affect your credit score, except in the event that it does something to your utilization numbers. E.g., transferring $1000 from a card with a $2000 limit to one with a $5000 limit would have a positive effect, while the reverse would have a negative effect.

[noobody]

OP:

please also find out if care credit retro interest from the day of purchase if balance NOT paid in full in 12 month

if that is the case balance transfer to Discover will make much more sense

[tussking]

I'm pretty sure...care credit interest is retro ! That's what they bank on...people not paying it off in that special interest period ! Call care credit and if it is retro than move it !

[Mshellt]

Oh! Thank you Noobody and Tussking-- did not know the % worked in retro! To those with concerns that I'll be tempted to pay minimum payments, that's not the case. I am eager to have my debts paid off..or at least down to a few dollars since it sounds like paying off cards causes a credit score drop. I just owe 1500 on the care credit card and a little over 1,000 on the Discover card. The discover card has a 7,000 limit. I currently pay 3-600 per month on each card and would plan on combining those payments if the balance is transferred to the Discover.

[joltdude]

Carecredit charges retro interest on 0% offers..... Even if its only to gain a month or two... DO THE BT....

[Anonymous]

If it is indeed retro...you got no choice but to BT

That retro B.S. is the worse.....

To ANYBODY considering a deal like that....you've got to budget yourself in way to schedule yur payoff HALF-WAY thru the promo period,

that way if one of life's hiccups happpens you've gor recovery time.

But getting down to the end, and banking on a miracle is way too dangerous to your pocket (luckily the OP here has an out...most don't).

some will say but I can't afford that to which I ask ppl to record themselves and learn to themselves, if you can't, you should leave the item in the store, until you can w/o killing your finances (here again this OP, is fine it's just a few payments more but the BT was required for the rescue..)

[Teo]

What Tussking and others said.  Care Credit interest kicks in retoactively if you don't pay it off in the 0% period.  That's why they approve people with shaky credit histories.  They make a ton of money when most of their borrowers don't pay off the balance in the promotional period.  I helped a family deal with getting sued by them.  Very smarmy company that preys on people in urgent situations, hence the reason they stick to medical needs.