How to Transfer Credit Card Balance

March 02, 2021
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Credit card debt can be daunting. Like any mounting debt, it comes with concerns about how it may be affecting your credit rating. Knowing how to do a balance transfer could be an efficient way to help pay down debt – and improve your credit. Moving your balance from a high-interest credit card to a card with a lower rate is a common debt consolidation strategy, and you could save a significant amount of money in the process. With a lower interest rate, you’ll be paying less in interest, which means you can devote more money to paying off the principal.

1. Get a credit card to move your balance to

So, how does a balance transfer work? Ideally, you will need to search for a credit card with a 0% APR introductory promotional offer, or at least a lower interest rate, along with no or low balance transfer fees and no annual fees. The goal is to pay off the balance during the low- or no-interest introductory period, which is typically six to 18 months. Even with a typical balance transfer fee of 3% to 5%, you could come out ahead, but it’s important to do the math before you make any decisions to transfer.[1] If you can’t pay off the balance during the introductory period, a balance transfer may not be a good decision.

2. Read the terms and conditions

Like so many things, it’s important to read the fine print so you understand the details of a balance transfer and avoid any surprises. Since you will still be carrying a monthly balance and required to pay off the minimum each month, a late payment could violate the agreement. In that case, you could lose the introductory interest rate offer on your transferred balance, as well as the grace period, leading to unwanted charges and penalties on any new purchases. The same may be true if you bounce a check or exceed the credit limit. Any of these could result in a penalty interest rate, which could be higher than the rate you paid before the transfer.[1]

3. Request a balance transfer from the credit card company

You may be wondering how to transfer money from one card to another. It begins by asking for a balance transfer, but there’s no guarantee your request will be honored. Any history of late payments, a low credit score, or a bankruptcy filing could result in your request being denied. Keep in mind that you will be requesting the balance transfer from the credit card company that currently holds the balance. It’s okay to submit that request by phone or online. As the cardholder, you will also need to give the account information and amount to the new credit card company so they can arrange the transfer of funds and pay off the old account.[1]

4. Wait for the balance transfer to go through

How long does a balance transfer take? It typically takes about five to seven days to transfer a credit card balance, but that’s not always the case. In some instances, it could take two or three weeks for the transfer to go through.[2] Credit card companies vary in how they complete these transfers, with some issuing a check and others completing the transfer electronically. During this time, you will still need to make payments on your credit card and pay off that debt. It’s important to keep an eye on your old account to ensure payments are made on time. Despite what you might think, it’s best to keep the old credit card open because closing a credit card can negatively impact your credit score.

5. Pay off your credit card balance

Remember that the balance transfer is a method for paying off the debt faster. This can only be accomplished by making payments on the balance transfer card during the low interest or 0% APR period. Once that’s over, you could face a higher interest rate – maybe even higher than the rate you paid before the transfer. This strategy won’t be as effective if you’re just a few months from paying off the balance on your current card or if you can successfully negotiate a lower interest rate from your current issuer.

When is it a good idea to do a balance transfer?

A balance transfer makes sense if you’re committed to reducing your debt and paying off the balance. As already mentioned, you can make this happen by transferring your balance from a high-interest card to a low interest or 0% APR credit card, a process that could take anywhere from a handful of days to three weeks, depending on the institution. You will also need to commit to paying off that balance before the introductory offer expires.

Does a balance transfer affect your credit score?

While moving your balance to a card with a lower interest rate can save you money and allow you to pay off existing debt, it doesn’t do much for your credit score. However, you will be in a position to devote more of your money to paying down the principal rather than simply paying interest. That’s a smart move for decreasing your overall debt, which in turn improves your credit.[3]

Unfortunately, your old account remains on your credit report even if you close it. Missed payments will appear on your report for years, and they will play a role in determining your credit scores. Your best move going forward is to make your payments on time and keep your debt to a minimum. Your credit utilization ratio, or the percentage of available credit that’s being used, should stay below 30%.[3]

Moving your balance to a credit card with a lower interest rate or 0% APR can be a good move for paying off debt and improving your credit score. But you need to be on high alert for potential pitfalls and committed to using your credit card responsibly. Before you transfer the balance on your credit card, it also helps to learn more about credit scores and why they matter.


[1]“How Credit Card Balance Transfers Work” (April 15, 2020).

[2]“How Long Does a Credit Card Balance Take?” (Sept. 6, 2019).

[3]“How a Balance Transfer Affects Your Credit Score” (Nov. 21, 2017).

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