Transfer the balance from one credit card to another to reduce interest rate
Different credit card providers have different conditions and annual interest rates. You may want to pay less for the credit limit and for using the card, so you can find a credit company with a lower interest rate and transfer your balance from one credit card to another. You can also consolidate different accounts into one. All these measures will allow you to reduce your loan repayment costs and speed up the repayment of the debt. Let’s look at the opportunities that you have for this.
- Learn how does it happens
Balance transfer from one credit card to another can be accomplished by visiting a website or making a phone call to your new lender. Contact information can be found on a credit card. You will need to specify the amount you want to transfer and the number of the old account from which you want to make a transfer. It must be remembered that if the transfer is approved by a new lender, the balance transfer process can take up to several weeks. In this regard, in order to avoid problems with the loan you should not stop making payments to the old account until you are notified that the balance transfer was successful. In addition, the new lender may approve you an amount less than that which you had.
- Get information about the unspoken balance transfer rules
In order to avoid unpleasant surprises in the future you need to know and understand all the conditions of balance transfer. Not all of them are voiced when discussing translation. For example, you should know that you will need to pay a charge 3% commission. Also you should understand that such a balance transfer from one credit card to another is usually approved by credit companies only if you have good credit rating.
It is also necessary to realize that the grace period with the 0% rate ends sooner or later. It usually lasts from six months to 18 months, so it is important to take this moment into account in order to correctly calculate the time for the start of interest payments and take into account their amount. Otherwise, skipping the payment , you are likely to be left without such a rate.
- Compare the available options
To choose the best and most suitable transfer option for you compare the conditions of different credit card providers by the parameters that we will discuss next.
Current annual interest rate
In order for a balance to be transferred from one credit card to another in principle, the interest rate of a new lender should be lower on a permanent basis than that of your current lender. Otherwise, you will not receive the benefits you would like to get from the balance transfer.
Depending on the issuer of your new credit card the amount of balance transfer may be limited. If you want to make the most of the opportunities that a balance transfer can provide you, find out how much your new lender can transfer. It will also depend on the condition of your credit.
Duration of interest free period
Compare the duration of interest-free periods with different lenders. A longer duration of such a period will allow you to get more benefits. Other things being equal choose a card issuer with a longer interest-free period.
The condition of your credit
Your credit rating will affect your ability to transfer your balance and its conditions. To get more interesting terms choose a lender with more flexible terms to approve a loan if your credit is not perfect.
Rewards for use
Many credit card issuers offer various bonuses and rewards for using their credit cards under certain conditions for some types of purchases. For example, lenders often offer rewards for using their credit cards when paying for purchases while traveling.
- Submit an application and request a transfer
When you have determined the terms of which credit card issuer are most suitable for you, you can fill out an application for issuing a credit card to you, and then request a balance transfer from another lender’s card. After reviewing your application and approving your credit limit on the card the card issuer will determine the amount of balance transfer that is available to you. Then, if approved, you will have to wait for the balance transfer, which usually takes several weeks.
- Decide whether to close an old credit card
When the balance transfer is successfully completed and you have received a formal notice of this, you will also receive confirmation of this from your previous creditor. Make sure you don’t have anything debt to your old lender before closing his card. You may not close the card of the previous issuer so that the credit limit on it will positively influence your credit rating if there is no annual payment for the card.
- Start paying your debt to reduce interest rate
In order to have time to take maximum benefit from transferring the balance to another credit card, begin to pay the debt as soon as possible, after confirming the transfer. This will help you use the zero interest rate period in the best possible way to save as much as possible money for you.
Following our advice you can successfully carry out a balance transfer from one credit card to another, despite the fact that from the very beginning this process might seem quite complicated. On our website you can find all the necessary information about how to reduce interest rate. If after this you still have questions you can contact our loan officers and get the answers that interest you.