Compare the longest balance transfer promotions here and learn how these offers can help you deal with credit card debt.
If you’re looking for the longest balance transfer offer available, you probably already know how a balance transfer works. When you transfer existing debt on to a credit card with a balance transfer promotion, you save money by paying low or no interest on your transferred debt for the period of the promotion. At the end of that period, any remaining debt from the transfer will be charged interest at the purchase rate or cash advance rate for that card (which is usually much higher). Depending on the size of your debt, the difference between a 6-month and 24-month 0% balance transfer promotional period could mean hundreds or thousands of dollars saved on interest charges. That said, the longest offers aren’t necessarily right for everyone. This guide will take you through the other factors to consider when comparing long balance transfer deals.
Compare 12-36 month Balance Transfer Credit Cards
How to compare long balance transfer offers
It’s always important to research and compare your options when choosing a credit card. When specifically looking at balance transfer credit cards, these are the key features to consider:
- Introductory offer. Introductory offers are typically worded like this: “Enjoy X% balance transfer interest for Y months”. In general, you will want the lowest X and the highest Y, ie, the lowest promotional interest rate over the longest term.
- Revert rate. This is the regular rate that interest reverts to once the introductory period ends. It’s usually the standard cash advance rate for that card, and sometimes the purchase rate. This is important in case you still have outstanding debt on your card when the revert rate applies.
- Balance transfer fee. Some credit cards charge a one-time balance transfer fee ranging from 1-3% of your balance transfer amount. Be aware that cards with longer promotional periods tend to charge a higher balance transfer fee.
- Balance transfer provider. This is important because balance transfers are often prohibited between affiliated banks and cards issued by the same card issuer. Learn more about which banks you can transfer your balance to and from.
- Maximum transfer amount. This could be your new card’s credit limit, or even up to a certain percentage of your credit limit, ranging from 75-90%. For example, if you are approved for a credit limit of $5,000 on a card that allows transfers of up to 75% of your limit, the maximum amount you could move to the new card would be $3,750.
- Other balance transfer conditions. This varies with each card, but there may be other conditions limiting where you can transfer your balance from. For example, some cards only allow balance transfers from other credit cards and store cards, while some accept debts from personal loans as well.
- Annual fee. Credit card annual fees can have an impact on the value you get from a balance transfer offer, so make sure your savings more than offset any card fees.
Finding a long balance transfer offerSundari has a credit card debt of $8,000 on a card that charges an interest rate of 18% p.a. She wants to clear the debt as quickly as possible, and calculates that she can afford to pay $500 a month towards it. If Sundari made these payments on her current card, it would take her 19 months to pay off the debt and cost her $1,060 in interest charges. But, if she was paying 0% interest on the balance, it would only take her 16 months to clear the debt. With this in mind, Sundari compares balance transfer cards offering 0% interest for 16-24 months. She decides to apply for a card offering 0% for 18 months, which gives her an extra 2 months of flexibility if other expenses come up in the meantime.
Tips for making the most of a long balance transfer offer
To get the most out of your balance transfer, consider the following tips:
- Close your old account. Closing your old account will prevent you from being charged any further costs, such as the annual fee, that could add to your existing debt and it will eliminate the temptation of using your old credit card. To cancel your account, wait until the balance transfer is processed, make sure the total balance is cleared and then call your issuer to request account closure.
- Make regular repayments. Make full use of the interest-free period by drawing out a schedule of regular repayments. Aim to pay off your full balance within the promotional period if possible, and follow that schedule responsibly to achieve your debt freedom.
- Use savings to help pay down the balance. Channel all resources towards paying off your debts, including spare cash and savings. Note: This tip is especially relevant if you’re near the end of the balance transfer promotional period and you still have debt remaining.
- Avoid making new purchases. Apart from being potentially charged interest on your new purchases, your best strategy is to dedicate all available resources towards paying down your debt. Even if the card is offering 0% interest on purchases, remember that any new purchases will add to your debt, instead of reducing it.
Using these tips, you can now compare long-term balance transfer credit cards to find the one that most suits your personal needs and circumstances. Sit down, research the options and use our calculator to see which card will deliver the greatest savings and convenience in the long run. Remember to only buy what you need and spend the rest on repaying that debt.