How to handle fee for a balance transfer?
Is 3% a good balance transfer fee?
Is a balance transfer fee worth it? If you have a significant amount of credit card debt, the 3% balance transfer fee (or sometimes even a 5% fee) is absolutely worth paying when transferring your balance to a card that has a 0% intro APR offer, but only if you still need time to pay off a balance.
Do you have to pay a fee for balance transfer?
Key Takeaways
A balance transfer fee is a charge imposed by a lender to transfer existing debt over from another institution. Balance transfers are commonly offered by credit card companies. Fees generally range between 2% and 3% of the amount transferred or a fixed dollar amount (as high as $10), whichever is greater.
How do I get around a balance transfer fee?
The simplest way to avoid balance transfer fees is to apply for a credit card that does not charge one. Getting a credit card with no balance transfer fee that also offers a low balance transfer APR is actually the best overall way to reduce the cost of existing debt and pay off what you owe sooner.
Can you negotiate balance transfer fee?
You can always try to negotiate your balance transfer fee by getting a credit card customer service representative on the phone. There’s no guarantee you’ll have any luck, but you can always call the card issuer and make your case.
How can you avoid a balance fee?
The only way to avoid a balance transfer fee is to find a card that doesn’t charge one. Such offers are generally reserved for people with good to excellent credit. If you’re not sure you fit that description, check your credit score to find out.
Do balance transfers hurt credit score?
The simple act of performing a balance transfer isn’t going to affect your credit score much, if at all. The key to changing your credit score is to use the transfer to reduce your debt — both in dollar terms and as a percentage of your available credit.
Are balance transfer fees a one time charge?
A balance transfer fee is a fee that’s charged when you transfer credit card debt from one card to another. It’s usually around 3% to 5% of the total amount you transfer, typically with a minimum fee of a few dollars (often $5 to $10).
What are transfer fees?
Wire transfer fees typically range from $0 to $50. Domestic outgoing wire transfer fees typically range from $0 to $35, while international outgoing wire transfer fees are usually $35-50.
How much will it cost in fees to transfer a $1000 balance to this card?
For example, your balance transfer card fee may be equal to the greater of 3% of the amount of each transfer or a minimum fee of $5. So, if you transferred a $100 credit card balance, your fee would be $5 because 3% of $100 is only $3. However, say you transferred $1,000. In this case, 3% of $1,000 is $30.
How do you figure out if a balance transfer is worth it?
To choose the right balance transfer credit card, compare your existing credit card’s APR with each prospective card’s balance transfer APR, balance transfer fee, and regular APR to see which card makes your debt cheapest to pay off in the end. The point of a balance transfer is to save money while paying off a debt.
Can I call my credit card company and ask for a lower interest rate?
You can negotiate a lower interest rate on your credit card by calling your credit card issuer—particularly the issuer of the account you’ve had the longest—and requesting a reduction.
What happens if I do a balance transfer?
When you initiate a balance transfer to a new credit card account, you “move” your balance from one or more cards to the new card. The card issuer will either pay off your other balance directly or cut you a check so you can do so.
Is there a downside to balance transfers?
Cons of a Balance Transfer
You could end up with a higher interest rate if you don’t qualify for a promotional interest rate because your credit score, income, or existing debt. You typically must have an excellent credit score to get a low interest rate balance transfer offer.
Should you close a balance transfer credit card?
You are not required to close the account once a balance transfer is complete, either. It may actually be a good idea to keep your old credit card account open, even if you don’t plan on using it. Closing a credit card account after a balance transfer could have a negative effect on your credit score.
What happens if you don’t pay a balance transfer off in time?
In rare instances, cardholder agreements stipulate that if you don’t pay off your transfer balance before the end of the introductory period, you’ll be charged interest on the entire transfer balance, just as if the transfer had been a regular purchase.
What happens if I balance transfer more than I owe?
When you overpay, any amount over the balance due will show up as a negative balance on your account. Negative balances are simply reported as zero balances on your credit report and will not affect your credit utilization. You also won’t earn interest on your negative balance.
How many credit cards is too many credit cards?
How many credit accounts is too many or too few? Credit scoring formulas don’t punish you for having too many credit accounts, but you can have too few. Credit bureaus suggest that five or more accounts — which can be a mix of cards and loans — is a reasonable number to build toward over time.
What is a 5 24 rule?
Chase’s 5/24 rule means that you can’t be approved for most Chase cards if you’ve opened five or more personal credit cards (from any card issuer) within the past 24 months.
Is it better to close a credit card or keep it open and not use it?
In general, it’s best to keep unused credit cards open so that you benefit from a longer average credit history and a larger amount of available credit. Credit scoring models reward you for having long-standing credit accounts, and for using only a small portion of your credit limit.