Get your finances in control and repay your debt interest-free with a 24-month balance transfer credit card.
If you're struggling to repay a high-interest credit card debt, a 24-month balance transfer credit card could help you pay down your debt without the burden of excessive interest for two years. The longest balance transfer promotional period on the market, you can usually either apply for a balance transfer with 0% interest rate or low-interest rate for the 24 month period. Once this promotional period ends, the standard interest rate on purchases or cash advances will apply on any remaining balance.
If you're looking for a way to consolidate your credit card debts, you can use this guide to understand how they work, compare your options and apply for a credit card with a balance transfer offer for 24 months.
Comparison on 24 month balance transfer credit cards
The finder.com.au list of credit cards with 0% interest
Compare the features of the credit cards below with a 24 month balance transfer.
|Credit Card||Balance transfer rate|
|0% p.a. for 24 months with 1.5% balance transfer fee|
|7.9% p.a. for 24 months|
What is a 24 month balance transfer credit card?
You can use these cards to transfer a balance from an existing credit card to a card with a promotional interest rate for 24 months. Depending on the card, this means that you'll be able to pay down your debt at a low or 0% interest rate for 24 months. Without the burden of high interest (or any interest at all, in some cases) you'll be able to pay off your debt faster and could save hundreds to thousands of dollars.The 24 month balance transfer promotion is the longest of its kind on the market, so it gives you the maximum amount of time available to pay off your credit card without high interest. However, once the promotion ends, any remaining balances will continue to earn interest at the standard purchase or cash advance rate.
Each month, you'll be required to pay the minimum repayment amount. However, if you want to pay your entire balance before the promotional period ends, you'll need to pay more than that. This promotional interest rate only applies on balance transfers, so you'll have to pay the regular interest rate on any purchases or cash advances you make with the card.
What should you look for in a credit card that offers a 24 month balance transfer?
As there are a few 24 month balance transfer credit cards available on the Australian market, there are a few factors you can consider to compare your options and determine whether or not this type of card is for you:
The promotional interest rate
Depending on the credit card, the balance transfer interest rate could be a low ongoing rate or 0% for the 24 month period. While a card with a 0% interest rate might seem more appealing, it might come with a higher annual fee that could offset the savings in interest that you'd make. You can look at how much debt you owe before you conduct the balance transfer and calculate how much you'd need to allocate every month to pay off your debt in full before the promotion ended to determine which option is right for you.
Basically, the more features your card has (such as Platinum cards), the higher the annual fee. Again, it's important to make sure that the interest savings exceed the annual fee. If it doesn't, you might want to consider a balance transfer card with a low or no annual fee.
Balance transfer fee
You may have to pay a balance transfer fee when you move your credit card balance from one account to another. This charge is normally a percentage of the balance. This means that the higher the amount you want to transfer, the higher the fee.
Unfortunately, the promotional low or 0% balance transfer rate will only be in place for the first 24 months. After this time, the remaining balance will collect a standard cash advance or purchase interest rate. This usually sits between 19% and 22%, so it's important to understand what rate applies in case you can't pay your entire balance before the promotion ends.Back to top
Pros and cons of a 24-month balance transfer credit card
- Lower interest. Whether the card has a low or 0% promotional rate, it's a much more cost and time effective way to repay your debts rather than with the higher interest of a standard card.
- Long repayment period. Balance transfers generally last between 6 and 24 months, so this is the longest repayment period available for low balance transfer offers. As long as you understand how much you need to repay each month, it should be a generous time frame to repay any existing loans.
- Standard rate applies to new purchases. Avoid buying new items using this credit card because the standard rate applies. As your repayments go to the debt that's collecting the highest interest, you’ll need to pay the interest for new purchases first. As interest-free days only apply if you're not carrying a balance, you won't be able to take advantage of these until you've completely repaid your debt.
- Revert rates. The low or 0% promotional interest rate is only in place for the promotional period, after which a much higher interest rate applies to any remaining balances.
Frequently asked questions
Do balance transfer cards offer rewards?
Some balance transfer credit cards do offer rewards, but you can't earn reward points on balance transfers. So, unless you're planning on using the card after you've repaid your debt, it's wise to concentrate on paying off your debt rather than making purchases to earn points.
What if I can pay off the debt in less than 24 months?
If you pay your debt in less than 24 months, you can either close the card or continue using it for purchases or emergencies. These cards usually have a higher interest rate on purchases, though, so you might want to go for a low rate option if you're not confident you'll be able to pay it off in full each month.