Interest-free balance transfers allow you to repay your existing credit card debt with no interest. Learn how to use interest-free balance transfers so you can save the most money.
Whether you have a small or large amount of credit card debt, if it is accumulating interest at a high rate then you are losing a lot of money. If you transfer the debt to a card that has low or no interest, it will make it possible for you to pay that debt down at a faster rate.
How do interest-free balance transfers work?
A balance transfer is the process of moving your outstanding credit card debt to a new credit card to save money on interest charges.
Interest-free balance transfers allow you to pay down the debt while paying absolutely no interest. For example, if you have a balance of $1000 on one card that is accumulating interest charges at 20% then at the end of 6 months you will have paid over $100 in just interest charges. That is a lot of money that is just thrown away!
If you switch that balance over to a zero interest balance transfer card then you are saving over $100 in that amount of time. Of course, if your balance is much more you will also be saving much more money.
Things you need to know before balance transferring your debt
Revert rate. After the balance transfer period has passed then the rate will revert back to the standard interest rate in some cases, but in other cases, it will revert to the cash advance rate.
No interest-free days. When you have completed a balance transfer and have an outstanding balance you will not receive any interest-free days on your credit card until you have repaid your outstanding balance in full. If you would like to make purchases whilst repaying your credit card debt, compare credit cards with 0% balance transfers and purchases.
Balance transfer fees. Interest-free balance transfer offers may charge a 1-2% fee of the entire balance transfer amount when you sign up for the card. Check for hidden fees and charges by reading our credit card reviews and the terms and conditions before applying.
Comparison of Interest-Free Balance Transfer Offers
The NAB Low Rate Visa Card has a balance transfer option allowing you to transfer your existing credit cards to the NAB Low Rate at a lower interest rate, giving your more time to repay your credit card debt.
Australian credit cardholders spent $6.3 billion in interest in the past year, where household were charged $1.3 billion in fees. finder.com.au lists the most common credit card mistakes that are costing Australians and how to avoid them.
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