Is There a Credit Card That Offers No Balance Transfer Fees?

By Contributing Writer

  • Overview

    Yes, there are credit card companies that allow customers to perform balance transfers without a fee. And while signing up for one of these cards can be quick and easy, you must consider a few things.
  • Definitions

    Before understanding how the parts of a balance transfer deal work together, it is necessary to understand a few terms. Credit limit--The amount of money that your credit card will allow you to charge on a card. Balance--The amount of money you have charged on a card. Ideally, your balance will be a smaller number than your credit limit. APR--Annual percentage rate. This is the amount of interest you are charged for charging money on your card. Interest rates can be as low as zero or as high as 28 or 29 percent. The lower the APR, the better deal you are getting for your card. Balance transfer--An amount of money charged to a card that is paid for by another credit card company who then assumes the debt. Fee--An amount of money charged for a service or assigned as a penalty.
  • No-Fee Balance Transfer

    The first thing that you should look for when doing a balance transfer is a lack of fees. Credit card fees can be surprisingly large and can add lots of money to an already high balance. A balance transfer with no fees attached allows you to shift the debt on one card to another without paying extra for the service. Be careful, however, because "no fee" does not mean "no interest."


  • 0 Percent Interest

    A popular promotional device for balance transfer services is to offer a 0 percent APR on the balance transfer. The 0 percent APR typically applies only to the balance transfer itself and not to any other charges that may be on the card to which the balance was transferred. A 0 percent APR is a good deal for the consumer. This allows you to borrow the money on the card for free. Not paying interest allows you to save more money because you are paying down an actual balance and not simply paying the interest that is accruing. However, the 0 percent APR will likely last for only a specific period of time. You may also have to make a certain number of payments to keep the promotional APR in place.
  • Low APR

    Another type of promotion involves letting consumers pay a low interest rate for a longer period of time. While the 0 percent APR rate may expire after a year, a low interest rate on balance transfers may last until the transferred balance has been paid off.
  • Which Is Right?

    To decide which deal is best for you, look at your own spending habits. If your goal is to pay down your debt, you are committed to being diligent about making payments and you can control new purchases, then a 0 percent interest rate could be great for you. Making a 0 percent APR work for you takes discipline and focus. If you can commit to those things, then a 0 percent APR can be a great tool. If, however, you feel that you need more time to pay down debt, then a low interest rate over a longer period of time may be the better choice.
  • Find the Right Deal

    Just like paying down debt takes a bit of focus and work, so does finding the right deal. Luckily, credit cards constantly put out information about balance transfer offers. Your job is to look through them. See Resources below for some sites that allow you to compare credit cards and their offers right in one place.
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