What Is a Credit Card Balance Transfer?

When dealing with a balance transfer, credit card companies will have their own procedures and rules that you will need to be aware of. Understanding what a credit card balance transfer is can be very beneficial to your financial situation. Here are the basics of a credit card balance transfer and how they work.

Balance Transfer

A balance transfer is a procedure that allows you to move a credit card balance from one card to another credit card. This can be done in a number of different ways. Many times, whenever you open a new credit card account, they will ask you if you want to transfer any balances to your new card. They may provide you with a book of checks that you can write to transfer the balance, or they might handle the balance transfer directly.

Benefits

You may be able to lower your interest rate significantly by utilizing a balance transfer. Many people will open a new credit card account because the credit card offers an introductory rate of 0 percent on all balance transfers. This can provide them with as much as 18 months of no interest in order to pay down their credit card balance and save money.

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