5 Best Balance Transfer Cards (And Why I Chose Them)
Last updated: 4/21/17
Are you stuck under a mountain of credit card debt?
It's a crappy feeling to open your statements each month only to see a huge balance staring back at you. What's even worse is seeing those interest charges pile up, knowing that there are so many better things you could be doing with that money.
Some people rack up credit card debt when they start a business, help family members with large purchases, or face unexpected medical expenses that aren't covered by insurance.
At the same time though, there are plenty of people who find themselves spending too much on random stuff they just had to have at the moment.
If you fall into one of these scenarios, help is here! Your situation won't change overnight, but you can make major headway on paying down those bills using credit cards.
I know, I know. That may sound odd, but credit cards are actually a powerful tool to help pay down debt if you know what you're doing.
By signing up for a balance transfer card, you're essentially being approved for an interest-free loan for a period of time. During this intro period, you get to take a break from interest charges and make payments toward the principal amount of debt. It's like hitting a freeze button on interest rates, which can help you pay down (or even pay off!) debt faster.
Now you may be wondering, "Why would a credit card company want to do that for me?"
When one company is charging you interest left and right, why is there another company willing to give you a free loan for well over a year?
Many – but not all – cards offer interest-free financing for long lengths of time, but will charge you a 3% fee on the amount you'd like to transfer to the card. While credit card companies do make money from the fee, you still get the peace of mind you're looking for in interest-free payments and the time to pay down your debt.
Another reason they're willing to give you a "free loan" for 12+ months? They really hope you'll remain a customer for years after the promotional APR period is over. Which, as long as you continue to make payments on time and steadily pay down your debt, is a great thing for both you and the credit card companies (imagine that!).
If it's possible, paying off your complete balance during the intro 0% APR period means you'll never pay a dime in interest.
So if you're ready to take a break from interest charges, here's my list of the top 5 balance transfer credit cards and why they're so great.
- 0% Intro APR for 15 months
- 0% balance transfer fee for first 60 days
- Free monthly FICO® score
- No penalty APR for late payments
- $0 annual fee
Remember when I said that not all credit cards charge a 3% balance transfer fee? Well, the major exception is the Chase Slate® Card, which offers 15-months of interest-free payments on both balance transfers and purchases and has no balance transfer fees for balances transferred in the first 60 days. There's also no annual fee.
That's a pretty sweet deal!
Chase also offers something called the Blueprint program with this card, which features powerful goal setting tools that can help you easily figure out how much you need to pay each month in order to pay off your balance before the standard interest rate begins to apply. This is especially helpful if your main goal is to pay off your balance before the end of the 0% introductory APR period.
- 0% Intro APR for 9 months
- Unlimited 1.5% Cash Back rewards
- $100 Cash Back one-time bonus when you spend $500 in first 3 months
- $0 annual fee
There's a lot to like about the Capital One® Quicksilver® Rewards Card, as it offers 9-months of interest-free payments on balance transfers and new purchases.
Another cool thing about this card is that it's actually a rewards card and a balance transfer card. So, on top of the balance transfer benefits, you'll also earn 1.5% cash back on all purchases.
Need another reason to convince you to check out this card? There's no annual fee.
Cardholders can also access CreditWise, a program that generates a free monthly credit score as well as a "what-if" simulator that shows you how your credit score can be affected by different actions, such as applying for new cards, transferring balances to a different card, and so on. It's really helpful since the simulator gives examples of your personal situation.
- 0% Intro APR for 21 months
- Longest intro period on balance transfer cards
- No penalty rates, no late fees!
- 3% balance transfer fee
- $0 annual fee
I don't want to sound biased or anything, but the Citi Simplicity® Card features one of the longest intro APR periods I've ever seen – 21 months of interest-free financing on both balance transfers and new purchases.
That's nearly two years of interest-free payments, which is insanely awesome!
It does come with a 3% balance transfer fee, but there are no late fees, no penalty interest rates, and no annual fee.
Not having all the bells and whistles as some of the other balance transfer cards listed here may seem like a deal breaker, but I assure you it isn't.
The reason being is simple, what you lose in other benefits, you gain in intro APR period with this card. You'll basically have an interest free loan for a whopping 21 months, which is way better than any of those other perks if your main goal is to pay down debt in my opinion.
- 0% Intro APR for 18 months
- Free monthly FICO® score
- $0 Liability Guarantee for fraudulent transactions
- $0 annual fee
The BankAmericard® Credit Card is part of the Bank of America – which is a huge, major bank – so it's no wonder so many people consider this card when searching for a balance transfer card.
It offers an incredible 18-months of 0% APR financing on balance transfers, with a 3% balance transfer fee, and no annual fee.
It's a fairly basic card, but that's one of the reasons I like it so much – it's simple to use and understand, and helps you pay down debt. It's easy to be swayed by other cards, but sometimes this type of straightforward card is the best option for you.
Plus, if you're already a Bank of America customer, it's really convenient.
I'm going to go out on a limb here and say if you're lazy like me, you hate logging into a million different accounts all the time. As an existing customer, you won't have to do that; you'll just log in once to access all of your accounts. Also, payments for BoA customers are often transferred a little quicker, which is a nice secondary benefit.
Two other cool benefits are:
- $0 Liability Guarantee which makes sure you aren't held responsible for purchases you don't make, and
- Bank of America's text messaging bank services. This allows you to send a text about your account and receive a response in seconds
- 0% Intro APR for 12 months
- $150 Cash Back bonus when you spend $1,000 in first 3 months
- 10% back at US restaurants for first 6 months (limited time offer through 5/3/17)
- 6% cash back on groceries (up to $6,000 per year, then 1%)
- 3% cash back at gas stations and select department stores
- 1% cash back on everything else
- $95 annual fee
Along with being great for balance transfers, the Blue Cash Preferred® from American Express is a powerhouse credit card.
Starting off with 12 months of interest-free payments on both balance transfers and purchases, you'll also earn $150 cash back after spending $1,000 in the first 3 months, which is the equivalent of the 3% balance transfer fee on $5,000.
This card also offers 6% cash back on up to $6,000 spent each year on groceries, 3% cash back at gas stations and select US department stores, and 1% cash back on all other purchases.
Considering the combination of an incredible 0% APR intro period and some incredible cash back benefits, the value of this card is insane!
There is a 3% balance transfer fee and $95 annual fee, but the other benefits are solid and thus, keep this card on my top 5 list for best balance transfer cards.
The credit card you choose is completely up to you (obvious, I know), but please, stop paying interest on your debt when you don't have to!
My best advice for tackling that debt? More of what you're doing right now – research the best credit cards that can help you achieve your goal of financial freedom. It can be strange to think about credit cards like that, but if you use it properly, one of these top cards could you one spot closer to being debt-free.
Disclaimer: This content and the opinions expressed here are the author’s alone and have not been provided, commissioned, or endorsed by the credit card issuer. All information was accurate at the time of this post but card terms and conditions may change at any time.