1Benefits of a Credit Card Balance Transfer Offer

When you transfer your old credit card’s balance into a new credit card that has a very low interest rate, you will save money.

A lower interest rate can save you hundreds, or even thousands of dollars in interest.

That will help you pay down the balance of the card much more quickly since more of your payment will be applied toward the principal balance of the card.

You may still be able to find balance transfer offers that give you 6 - 12 months where there is no interest charged at all.

Other possible benefits of transferring your credit card balance to another card are loyalty points and rewards.

2Analyze Your Credit Situation

Before you take any action to transfer your credit card balances, you should take a realistic lok at the health of your credit.

This is particularly important considering the current state of the economy which caused lenders to be more restrictive about offering credit. You should review your credit history and determine if it is solid enough. It isn't a good idea to apply for an offer that will be rejected.

The items you should look for are consistent patterns of paying your credit card bills on time and making sure that you don't have an unusually high number of open credit cards.

3Determining Which Credit Card Balance To Transfer

You should also think about the amount you wish to transfer.

For instance, if the total amount you have as outstanding balance on a couple of credit cards that attract high interest rates is $20,000, it is unlikely that you can transfer this sum on a single balance transfer offer.

It is most likely that just a portion of this sum can be transferred. That said, it is still better to take the balance transfer offer because it will at least be a small step toward reducing your interest rate.

4Use Your Credit Cards Responsibly

If you go through with the credit card balance transfer offer, you should be responsible about it.  Use that time to reduce the principal balance of the credit card, don't go out and spend money on the credit card that now has a lower balance due to the transfer.

Use your credit card balance transfer as a way to solve your money problems, not to make them worse by charging up additional balances.

5Read the Fine Print

It is important to read the fine print on any offer you are considering.

If it says 0%, make sure that applies to the entire balance you will be transferring.

If it says "free", make sure that applies to all aspects of the card, not just the first month, etc.

Read all of the terms so you understand all of the details.

Most credit card balance transfer offers are only for a limited time.  Six - 12 months is the most common.  Make sure to identify this timing when you are comparing your options.

6Review All the Features of Your Card

Don’t let the single feature about the low rates be the sole determining factor when you make your decision.  There are many other features that you must take into consideration.

Find out about additional features like fraud liability coverage, annual fees, and cash-back plans. Review all of the options so you can compare all the features, not just the interest rate.

7Pay Attention to the Dates

Keeping track of dates is important to make sure you actually experience all of the benefits that are available to you.

In most cases, just a single late payment might dramatically increase your interest rate. You could also be subject to a large late payment fee.

You should also keep careful track of when the introductory rate expires.  In the best case scenario, you can pay off most of the credit card with the extra funds you are saving due to the low rate.  However, if you still have a significant balance, you should look at the new interest rate to determine if it is still in your best interest to keep the balance on that card.

Do you have any other tips or experiences with credit card balance transfer offers you would like to share?