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Combine credit cards with a balance transfer

Reduce interest and repay your debt faster by using a balance transfer to consolidate your credit cards onto one account.

With different interest rates and statement due dates to consider, juggling balances on several credit card accounts is usually expensive and hard to manage. This is when a balance transfer credit card can come in handy. You can use these cards to combine your credit card debts onto one account while taking advantage of a low or 0% interest rate for an introductory period. In this guide, we'll explain how this debt consolidation option works and what you need to consider if you want to combine and pay off your credit card debts.

How to combine credit card debts with a balance transfer

You can use a balance transfer credit card to move one (or more) balance from an existing credit card to a new credit card. These cards usually offer a low or 0% interest rate for an introductory period, allowing you to repay your debt without the additional cost of interest. At the end of the promotional period, any balance remaining will collect a revert rate.

When you apply for a balance transfer credit card, you'll have the option to nominate one or several accounts to move to the new card. So make sure you have the details of your existing accounts ready when you're filling out the application. The number of debts you can move will vary between providers, but usually the combined amount can't exceed a set balance transfer limit. This limit is usually a percentage of your approved credit limit (such as 80% of your credit limit). So, if you had a credit limit of 10,000 and a balance transfer limit of 80%, you could only transfer a combined debt of $8,000.

If you're approved for your balance transfer credit card, your multiple balances will be consolidated into your new account within a week or two. Please note that the 0% balance transfer period usually begins as soon as your card is activated, rather than when the balances land in your account. Remember that it's your responsibility to close your old accounts once the balance transfer is complete, so make sure to contact your old bank to avoid collecting maintenance fees.

What to consider before combining credit cards with a balance transfer

Here are some key factors to consider with this type of debt consolidation:

  • Low or 0% interest promotion periods. Balance transfer offers can be as short as three months or as long as 30 months. The more debt you have, the longer the balance transfer offer you’ll need to consider to help reduce your fees while you pay off the debt.
  • Standard interest rates. Also called the “revert rate”, this refers to the interest rate that will apply once the promotional period is over. Make sure this rate is one you can live with if you think you’ll carry a balance beyond the introductory period.
  • Balance transfer limits. The amount of debt you can transfer is based on the credit limit you’re approved for with the new card. For example, some cards restrict your balance transfer amount to a percentage of your credit limit, such as 75% or 90%. This could have an impact on your transfer if you have a lot of existing debt.
  • Balance transfer fees. Some cards charge a one-off fee for balance transfers, which could be between 1–3% of the total approved transfer. For example, if you have two cards with a combined debt of $6,000, moving it to a card with a balance transfer fee of 2% would cost you $120.
  • Other balance transfer restrictions. Your new card provider may impose its own set of rules around balance transfers, for instance by limiting the number of accounts you can balance transfer at one time, or the type of account you can move across. A more generic restriction might be the inability to transfer balances between affiliated credit card providers, or between cards issued by the same institution. Learn more about which banks you can balance transfer to and from to avoid potential problems.
  • Credit rating. As with all types of credit card, most balance transfer card applications will require that you have a good to excellent credit score. Find out more about your credit file and how to improve your credit score.
  • Ongoing card features. Also consider other features of the card, such as the annual fee and any complimentary extras that may ensure its suitability and sustainability as your long-term credit card.

How to save money by combining credit cards with a balance transfer

To illustrate how transferring credit card debt works and how you could save on interest, let’s look at an example of someone with two credit card debts with a combined debt of $6,000:

  • Card 1 debt: $2,000 with a 20% p.a. interest rate
  • Card 2 debt: $4,000 with an 18% p.a. interest rate

These cards also have annual fees of $50 and $200 respectively.
The cardholder is considering consolidating both cards with a balance transfer credit card offer of 0% p.a. for 15 months, with an annual fee of $150. They've only been making minimum payments on their current cards. But if they're able to repay the consolidated debt within the interest-free period, in one year they could save:

  • Interest: $1,120 (which is $2,000 x 20% + $4,000 x 18%)
  • Annual fees: $100 (which is $50 + $200 - $150)

This is a total of $1,220 in the first 12 months, or $1,400 if factored over 15 months. Note that these figures could vary slightly depending on the minimum payments, but offer an accurate guide to the potential savings that could come from combining credit cards onto a new balance transfer card.

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Steps for combining your credit card debt with a balance transfer

Follow these simple steps if you’re looking to consolidate your debts using a balance transfer.

  1. Find out the total amount of debt you owe. Take inventory of your credit card liabilities by summing them up. It is safer to do this by calling your card company as your previous month’s statement or even your online statement may not reflect accruing interest for the month and other possible impending fees. You don’t want to leave small amounts owing after the balance transfer has been completed. Explain that you wish to do a balance transfer and ask for your total outstanding balance.
  2. Compare balance transfer credit cards. This is an important step, and you should take your time to research the available options on the market. Consider the list of factors outlined above during this process.
  3. Begin the application. Applications are mostly online these days, and take around 10–15 minutes to complete. Make sure that you meet the card’s eligibility requirements, and have all the necessary details on hand.
  4. Include details of your existing credit card debts. It’s important that you get this section of the application correct by filling in the outstanding amounts for each account at the time of applying.
  5. Submit your application. Submit your application and keep those fingers crossed. Most online applications will provide you with an outcome in a few minutes. If your application is successful and you have provided all the required documents, you can look forward to receiving your new card in about two weeks.
  6. Activate the card. Upon receiving your card, activate it by following the attached instructions. This will also activate the balance transfer, which usually takes between 5–10 business days to process.
  7. Confirm the transfers and close your old accounts. Once your balance transfers have been completed, you should see that your previous account balances are $0. Call your former credit card providers and close your old accounts to avoid any further fees or the temptation to use them.

A balance transfer can be very helpful when you’re struggling with multiple credit card debts. If you’ve decided to go ahead with this process, make sure you carefully research the market, compare available card offers and weigh up your options before choosing the right balance transfer credit card for you.

Top balance transfer credit card offers*

Rates last updated June 20th, 2018
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Name Product Balance transfer rate (p.a.) Purchase rate (p.a.) Annual fee Amount Saved Product Description
Westpac Low Rate Card
0% p.a. for 24 months with 1% balance transfer fee
13.49% p.a.
$0 p.a. annual fee for the first year ($59 p.a. thereafter)
Offers a 0% for 24 month balance transfer option, first year annual fee waiver and a competitive purchase rate.
HSBC Platinum Credit Card
0% p.a. for 22 months with 2% balance transfer fee
19.99% p.a.
$0 p.a. annual fee for the first year ($129 p.a. thereafter)
Offers a 0% p.a. for 22 months balance transfer, $0 annual fee for the first year and an annual fee refund each year when you spend $6,000.
St.George Vertigo Platinum - Online Offer
0% p.a. for 24 months with 1% balance transfer fee
12.74% p.a.
$0 p.a. annual fee for the first year ($99 p.a. thereafter)
Platinum card benefits including complimentary insurance, plus first year annual fee waiver and 0% p.a. for 24 months on balance transfers.
NAB Low Fee Platinum Card
0% p.a. for 24 months with 2% balance transfer fee
19.74% p.a.
$90 p.a.
Offers 7 complimentary insurance covers, a 0% p.a. for 24 month balance transfer and access to a 24/7 concierge service for a $90 p.a. annual fee.
Suncorp Clear Options Platinum Credit Card - Exclusive Offer
0% p.a. for 18 months
20.74% p.a.
$99 p.a. annual fee for the first year ($129 p.a. thereafter)
finder Exclusive: Receive a long 18-month, 0% p.a., no fee balance transfer and earn Suncorp Rewards Points or Qantas Points per $1 spent.
Virgin Australia Velocity Flyer Card - Bonus Points Offer
0% p.a. for 18 months
20.74% p.a.
$64 p.a. annual fee for the first year ($129 p.a. thereafter)
Earn up to 60,000 bonus Velocity Points in the first 3 months and enjoy a discounted annual fee of $64 for the first year.
HSBC Low Rate Credit Card
0% p.a. for 20 months with 2% balance transfer fee
13.25% p.a.
$79 p.a.
Receive up to 20 months interest-free on balance transfers with a 2% BT fee. Also enjoy exclusive offers with the home&Away Privilege Program.
Virgin Money Low Rate Credit Card
0% p.a. for 14 months
11.99% p.a.
$49 p.a.
Offers a discounted annual fee, $100 cashback when you meet the spend requirement and 0% p.a. for 14 months on balance transfers.
Citi Simplicity Card
0% p.a. for 15 months with 1.5% balance transfer fee
19.99% p.a.
$0 p.a.
Save with 5% cashback on eligible purchases (capped at $50 per month) for the first 90 days from approval. Plus, a 15 month balance transfer offer.
Qantas Premier Platinum
0% p.a. for 15 months
19.99% p.a.
$299 p.a.
Get 40,000 bonus Qantas points each month (up to 80,000 pts) for the first 2 months when you spend at least $3,500. Plus, a long-term BT offer.
NAB Low Fee Card
0% p.a. for 18 months with 2% balance transfer fee
19.74% p.a.
$30 p.a.
Receive complimentary purchase protection insurance, a 18 month balance transfer offer and special offers from Visa Entertainment.
Bank of Melbourne Vertigo Platinum Card - Online Offer
0% p.a. for 24 months with 1% balance transfer fee
12.74% p.a.
$0 p.a. annual fee for the first year ($99 p.a. thereafter)
Online only: Enjoy 0% p.a. interest for 24 months on balance transfers (with a one-time 1% BT fee). Plus, a $0 first year annual fee.
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
0% p.a. for 18 months
20.74% p.a.
$64 p.a. annual fee for the first year ($129 p.a. thereafter)
Take advantage of 0% p.a. on balance transfers for up to 18 months. $64 in the first year ($129 p.a. thereafter), plus, bonus Velocity Points.
Citi Rewards Platinum Credit Card
0% p.a. for 26 months with 2.5% balance transfer fee
20.99% p.a.
$49 p.a. annual fee for the first year ($149 p.a. thereafter)
Earn reward Points per $1 spent, take advantage of a 0% p.a. for 26 month balance transfer offer, plus complimentary international travel insurance.
St.George Vertigo Visa
0% p.a. for 18 months with 1% balance transfer fee
13.74% p.a.
$55 p.a.
Enjoy a 0% p.a. for 18 months balance transfer offer. Plus, up to 55 days interest-free on purchases.
Citi Platinum Credit Card - 100k Bonus Points
0% p.a. for 15 months with 1% balance transfer fee
20.99% p.a.
$49 p.a. annual fee for the first year ($149 p.a. thereafter)
Earn 100,000 reward Points, enjoy a long-term balance transfer offer, a discounted first year annual fee and complimentary travel insurance.

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Credit Card Offers

Important Information*
Westpac Low Rate Card
Westpac Low Rate Card

Interest rate

13.49

Annual fee

59
HSBC Platinum Credit Card
HSBC Platinum Credit Card

Interest rate

19.99

Annual fee

129
St.George Vertigo Platinum - Online Offer
St.George Vertigo Platinum - Online Offer

Interest rate

12.74

Annual fee

99

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