0% Interest Balance Transfer
I am currently working on eliminating all my credit card debt and my car loan, both total to about $12k. It’s not too bad but the interest rates on the credit cards, one at 21% and the other at 19%, are making things difficult.
I have thought about opening another card with a low or no interest balance transfer.
I feel it’s safe to assume that paying off the balance transfer in full before the promotion period ends should be the goal.
But I’m curious as to the potential pro’s and con’s of opening another card for the 0% interest on balance transfers.
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When my girlfriend, now wife, was paying off debt she did open a new card with 0% rate and balanced transferred to it. There was a fee, but it was less than keeping the balance on the higher interest rate card. She dug deep and paid off the loan before the teaser rate expired. She cancelled streaming services, cut out unnecessary spending and any additional income went into the debt payoff. She was so gazelle focused that even the $5 birthday money from Grandma went against the balance.
Other than the balance transfer fee, and the slight ding on her credit report for the new card there wasn't any drawback. Eventually her credit score went up and she's over 800 today.
Credit is like any power tool. Wielded responsibly it can make tasks easier, but if applied incorrectly it can have awful consequences.
The ding on one’s score seems minuscule compared to having paid off one’s debt.
I’m going to add searching for a balance transfer card onto my to-do list.
Thank you for the insight!
I’ve been looking up cards for a potential 0% apr balance transfer and am considering the Chase Freedom Unlimited.
It has no annual fee, 15 month 0% apr on balance transfer, 5% cash back on travel purchased through Chase Travel, 3% cash back on drugstore purchases and dining at restaurants.
Curious to know if anyone has an opinion one way or the other on this card.
We used this card for a debt transfer and have been very happy with it. It has good points-earning potential, a generous time period to pay down the debt, and easy to transfer points to other Chase cards. However, I'd encourage you to look for a card with no annual charge and no transfer fee, if you can find it. I just had an offer from Navy Federal Credit Union (you do have to qualify to become a member) that was hard to beat (1 year at 0% and no fees). Good luck!