How Balance Transfers Work

You open a new credit card that offers 0% APR on balance transfers for a promotional period, usually 12 to 21 months. You move your existing credit card debt to this new card, and for that promotional period, you pay no interest.

The Catches

Balance transfer fees are usually 3% to 5% of the transferred amount. The bigger catch: if you don't pay off the balance before the promotional period ends, you're hit with the regular APR.

Making It Work

To successfully use a balance transfer card: calculate if you can realistically pay off the balance before the promo ends, factor the transfer fee into your math, don't use the card for new purchases.

Track Your Payoff Progress

Spendify's debt planner can help you map out exactly how much you need to pay each month to hit zero before your promotional rate expires.