New blog article: What Are the Pros and Cons of Balance Transfers?

[Elizabeth_FICO]

Hello everyone! My name is Elizabeth and I am the editor of the blog at myFICO. If there's a new blog article that I think you guys might like I plan on posting it in the Forums.

I thought you guys might like our article on balance transfers: What Are the Pros and Cons of Balance Transfers?

Let me know what you think about the article.

[Remedios]

What I'm finding really strange is getting BT offers from lenders that typically aren't BT happy past the initial approval, but those who made BTs their bread and butter have taken them away. 

[Loquat]

@Remedios Exactly! I've received offers from a couple of lenders lately who I know will drop the hammer the minute I actually use it.

[JR_TX]

Penfed lives in my wallet for one sole purpose in life.... B friggin T! 

[Loquat]

@JR_TX PenFed's standing 0/3/12 is nice when you need it.  No need for wait for an offer or invitation...it's just a constant with them.  

[Kforce]

---

@Loquat wrote:

@JR_TX PenFed's standing 0/3/12 is nice when you need it.  No need for wait for an offer or invitation...it's just a constant with them.  

---

Not having PenFed please explain 0/3//12, do not understand ?

[JR_TX]

---

@Kforce wrote:

---

@Loquat wrote:

@JR_TX PenFed's standing 0/3/12 is nice when you need it.  No need for wait for an offer or invitation...it's just a constant with them.  

---

Not having PenFed please explain 0/3//12, do not understand ?

---

0% APR / 3% BT Fee / 12 months anytime. 24/7 no need for an offer to pop up!

[coreysw12]

My favorite way of transferring a balance is not by using balance transfers.

• Open a new rewards/points card that has 0% intro APR.
• Whatever the amount of balance I want to transfer to it is, I charge that much daily spending to it, earning points/rewards.
• Instead of paying off the balance on the new card, pay it to the old card.
• Voila, balance has moved from old card to new card, earning rewards and avoiding BT fees

I did that back when CFU had 15mo 0% intro APR and 3% cashback for the first year. Instead of paying BT fees, I earned 3% when I shifted my balance from another card over to it.

[longtimelurker]

---

@coreysw12 wrote:

My favorite way of transferring a balance is not by using balance transfers.

• Open a new rewards/points card that has 0% intro APR.
• Whatever the amount of balance I want to transfer to it is, I charge that much daily spending to it, earning points/rewards.
• Instead of paying off the balance on the new card, pay it to the old card.
• Voila, balance has moved from old card to new card, earning rewards and avoiding BT fees

I did that back when CFU had 15mo 0% intro APR and 3% cashback for the first year. Instead of paying BT fees, I earned 3% when I shifted my balance from another card over to it.

---

How does that work in general?   Let's say I have $30K of debt on a 29.9% APR card.   If I was lucky, I could pay say a 4% BT fee and transfer the entire amount to a card with a much lower APR.

Now my daily spend is very low (partly because of all that debt!).  So if I am spending $500 a month, and I move  all that spend to the new 0% card and use most of the $500 to pay off the high APR card, I'm really not making much progress.

I must be missing something!

[Slabenstein]

I think it would only work if your spend relative to the debt is high enough to "transfer" it relatively quickly.  Sounds like a good idea when that's the case, though.