topic Re: First Time Balance Transfer in Credit Cards

First Time Balance Transfer

WJL — Thu, 31 Jul 2014 20:45:11 GMT

Hi all, I have balance transfer offer from Discover (0% APR for 12 mos) that is expiring today. It's a $9,500 limit card and I was looking to use about $9,000 of it to transfer a balance from my PenFed card. This way I can avoid the APR from PenFed and have flexibility to pay it off.

Should I go for it? Is there anything I should know e.g. impact on FICO score, will it reflect negative with PenFed the fact that I'm using a balance transfer, etc.

Thanks!

Re: First Time Balance Transfer

lhcole77 — Thu, 31 Jul 2014 20:56:14 GMT

@WJL wrote:
Hi all, I have balance transfer offer from Discover (0% APR for 12 mos) that is expiring today. It's a $9,500 limit card and I was looking to use about $9,000 of it to transfer a balance from my PenFed card. This way I can avoid the APR from PenFed and have flexibility to pay it off.

Should I go for it? Is there anything I should know e.g. impact on FICO score, will it reflect negative with PenFed the fact that I'm using a balance transfer, etc.

Thanks!

9000/9500=95% UTL. For most people that will be considered maxed out. Could see a hit to score for that.

Not uncommon to transfer large amounts though. Shouldn't be an issue with PenFed (though I don't speak from experience).

I transfered a large amount from Barclays to SDFCU in June and there have been no issues.

Re: First Time Balance Transfer

WJL — Thu, 31 Jul 2014 22:51:43 GMT

Thanks for your reply. But isn't the overall credit utilization evaluated not? Do they look at individual cards utilizations too?

Re: First Time Balance Transfer

lhcole77 — Thu, 31 Jul 2014 23:01:11 GMT

@WJL wrote:
Thanks for your reply. But isn't the overall credit utilization evaluated not? Do they look at individual cards utilizations too?

They look at individual card UTL, overall UTL, and how many accounts are reporting a balance.

Good news is the ding to your score will only be temporary. Once the card's UTL dips below the thresholds (some say 90%, 70%, 30%, 10%) then your score may rebound each time.

Re: First Time Balance Transfer

WJL — Thu, 31 Jul 2014 23:03:52 GMT

Awesome info, thanks very much!

Re: First Time Balance Transfer

lhcole77 — Thu, 31 Jul 2014 23:54:39 GMT

@WJL wrote:
Awesome info, thanks very much!

You bet!

Re: First Time Balance Transfer

compassion101 — Thu, 31 Jul 2014 23:59:29 GMT

If there is a credit score hit it is only temporary. No big deal if you aren't planning on applying for credit in the near future. It will correct itself as the balance gets paid off

Re: First Time Balance Transfer

WJL — Fri, 01 Aug 2014 00:37:24 GMT

Thank you! I just made the BT request!

Re: First Time Balance Transfer

Kenny — Fri, 01 Aug 2014 00:49:21 GMT

See if you can get a SP-CLI in an attempt to not make the card maxed. You might be surprised and get one.

But like others have said -- it's a temporary hit and so long as you are making good payments the utilization will come down.

Re: First Time Balance Transfer

WJL — Fri, 01 Aug 2014 00:51:58 GMT

Thanks for that - that topic did come up during my conversation and although a CLI was not possible right now, the rep said there should be an automatic CLI check on my account very soon. So I'll keep a close eye on that!