BofA BT Offer

[pl-724]

I have a BT offer on my Customized Cash Rewards card (at a 3% transfer rate):

0.00% until 11/23

1.99% until 02/24

The card in question has a balance of around $100 and a credit limit of $5300.

I do want to take advantage of this offer. My cards are sort of a mess at the moment. I was thinking of doing a BT on two cards onto BofA. The first would be Capital One, which is at $1200/$2000.  The other is Care Credit (which I opened for a pet that has since passed), which is at $1800/$12,000. These would be the easiest to move, not just based on due dates, but also because they are the lowest balances and least used. This would pay off two cards and briefly increase BofA to over 60% usage.

Would I incur a penalty on my FICO score for a transfer like this? I've read that sometimes cards without balances don't actually count towards your total usage.

[OmarGB9]

Cards without balances most certainly count for scoring purposes. In fact, if you have 50% or more of accounts reporting a balance, you incur a penalty. So the more open, active cards with zero balance you have, the better. 

That said, taking one card over 50% would probably yield a slight score hit, yes. It'd be impossible to say just how much though; also, this score hit may be offset by the possible point gain due to two more cards having zero balance. 

[tcbofade]

Cards without balances certainly DO count in your available credit.

That's how some folks with ungodly amounts of debt keep their utilization in check.  Ask me how I know.

As mentioned above, you might see a slight score ding for the BofA card reporting over 48.9%, but you don't mention any other cards or what they might be reporting so there is no way to be certain.  If you do see a score ding, it won't be bad, and finances are more important than ficos.

If it saves you dollars, do it.

Good luck!

[pl-724]

I appreciate the knowledge and advice from both of you.

I started the process and noticed that I could choose the amount to transfer. Is that actually possible? Does BofA actually allow for partial balance transfers? Something like that could potentially change my calculus.

[OmarGB9]

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@pl-724 wrote:

I appreciate the knowledge and advice from both of you.

I started the process and noticed that I could choose the amount to transfer. Is that actually possible? Does BofA actually allow for partial balance transfers? Something like that could potentially change my calculus.

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Yes, all issuers ask you how much you want to BT over. It doesn't have to be the full amount of another card.

[atarvuzdar]

I use balance transfer offers all the time, they are quite useful if used correctly. Based on the info you gave in your original post, your Capital One card is already over 50% util so doing balance transfers that would bring your BofA over 50% probably won't impact you much, if at all. 

A few things to keep in mind:

1) Your scores will go up/down during the process of transferring balances while each of your accounts reports. Strap in and don't panic while this occurs, it will settle down to the ultimate score after your last account reports during this period. 

2) Since you mention that you realized partial balance transfers are possible (and, yes, they are) don't forget that paying off a card in full will get you more points than making partial payments across several cards. Too many accounts with balances of any kind is not a good thing. In fact, this is one of the biggest benefits (in my opinion) to balance transfers. Quick way to get down to AZEO. 

3) Most importantly, balance transfers are NOT an opportunity to spend on those cards you are paying off/down.