0% Balance Transfer

Can someone explain this to me like I am a stupid small child?

Years ago a girl I used to work with would always do this and switch credit card debt around.

My questions are; is this a good thing to do, does it negatively effect your credit?

In the past I always paid cc's down to $0 each month and never had interest. Since I bought my house I opened a Lowes and a Home Depot credit card because they were interest free for a year.

Well I didn't realize this, but the interest free part is only for the first purchase which I have already paid off, so they are now charging me a lot of interest even if I made more than the minimum payment each month.

Each card has about $1,200 on it, so my thinking was I would finishing buying everything I needed from these stores and then do a 0% balance transfer and paid off the full amount within the next few months.

Does that sound like it is too good to be true and wouldn't work? Or does it come with a penalty?

Thanks so much!!!

Re: 0% Balance Transfer

I dont think it will negatively effect your credit score if you do not have a million other cards already open. It is also important to continue to use and pay off your oldest cards in full each month. The longevity you have with those cards are what earn you a good credit score.
Also be aware that some 0% interest cards charge a transfer fee these days. Do the math and make sure you are still saving money in the long run!

Re: 0% Balance Transfer

Re: 0% Balance Transfer

It won't negatively impact your credit unless it requires opening a new card, but if you don't have a lot of cards already, i think it's worth it.

Basically you can transfer the debt to anothr card and they will charge you 0% interest for a period of time, after that it goes to the prevailing interest rate and they'll tell you what that is. There is a fee. Usually 3-5% that will be added to the 0% balance.

One thing to ask, especially if you already have debt on the card you're transferring to is how payments get posted. I did a transfer to an empty card- no problem. I was going to do another transfer to another card with a balance but payments would go to the 0% balance first, so it wouldn't help. If I had realized and thought ahead, i would have transfered THAT card to the empty card to make it empty and then transfered another card to THAT card so I'd have 2 balances at 0%, but I didn't really think of it.

I did it recently because I had one card which I'd paid down and had a zero balance and I transfered another card with a high interest rate to it. Now the high interest rate card is empty - woo hoo!

Re: 0% Balance Transfer

you are probably paying 24% on those store cards, so it would be worth it. 3-5% transfer fee will be around $100.

I would look into getting a new card with 0% interest. do your future purchases on that card, you will get rewards + 0 % interest. and avoid a transfer fee.

Look for one with 0% for the longest time line.

I found citibank had 0% for 2 years. I transferred the balance and pay what i need to pay off the balance in the 2 years.