A credit card rollover is another term for a balance transfer. This involves moving your debt onto a card with a low or 0% p.a. introductory interest rate.
If you're paying a high interest rate on your credit card debt, transferring it a new card that offers a low or 0% p.a. interest rate gives you a way to save on charges during the introductory period. This can also help you pay off the debt faster, as more of your money will go towards the balance (rather than rates and fees). While this strategy is usually known as a balance transfer, it's sometimes described as a "credit card rollover" because the process allows you to "roll" your credit card debt "over" to a new account.
Compare credit card rollover or balance transfer offers
Credit card rollover basics
What types of credit cards allow you to roll your debt over?
These are the main types of balance transfer or rollover credit card options on the market.
- 0% balance transfer cards
These credit cards offer an introductory 0% p.a. interest rate for the debt that's rolled over to the new card. You can usually transfer debt from any Australian credit card, store card or charge card that's held with a different issuer. At the end of the introductory period, the 0% p.a. interest rate reverts to a higher, standard rate that will be charged for any debt left over from your balance transfer.
- 0% balance transfer and 0% purchase rate cards
This type of credit card gives you an introductory 0% p.a. interest rate when you rollover your existing debt and also offers 0% p.a. interest on purchases during the introductory period. In some cases, the 0% interest period may last for different lengths of time. For example, the balance you rollover might get 0% p.a. for 12 months, while new purchases get 0% p.a. for 6 months. At the end of these introductory periods, the cards standard interest rates apply.
- Long-term balance transfer cards
If you have a lot of debt you want to rollover to a new credit card, a long 0% p.a. introductory period can help you save as much as possible on interest charges. Some long-term balance transfer cards offer interest-free periods of up to 24 months, giving you a decent amount of time to focus on paying off your debt before standard rates apply. Depending on the amount of debt you rollover, this could even be enough time to pay off your debt completely.
How can I pick the right rollover card?
If you pick a credit card that does not give you enough time to pay off your debt in full, you will have to pay the higher, standard rate of interest once the introductory period ends. So, remember to take a look at your budget before comparing cards. How much money can you afford to pay on a credit card repayment every month? Make sure that this is a comfortable amount and that you have left room for unexpected situations that may arise on any given month. By examining your budget you will be able to figure out how long it would take you to pay off the balance you owe on your different credit cards. Then you can start comparing the different offers based on your goals.
How to compare credit card rollover deals
Here are some of the main points you should look for when you're doing a comparison between balance transfer credit cards.
How can I apply for a credit card rollover?
After you have compared balance transfer credit card offers you can go to the official credit card website and submit an application. You will need your personal details, information about your income and the credit card number and provider of your current card. You will also have to enter in the amount of the balance that you want to transfer.
Most credit card providers will let you know within a matter of 60 seconds whether you have been approved for your new balance transfer card or not. After that, you'll need to activate your card so that the new bank can complete the rollover process.
What happens once I've got a credit card rollover?
Make sure that you make all your minimum payments, and pay more if you have set up a budget to get the debt paid off within the introductory period. Remember to take note of the due date for your payments so you can avoid any penalties that may apply for late payments.
As mentioned earlier, you should avoid making any purchases with your new balance transfer card. You should also put the card away in a safe place so you won't have the temptation of spending with it. Credit card application tips to help you get approved
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