For a while, 0% balance transfer credit cards disappeared from mailboxes.
Now, though, they are starting to make a comeback as the economy improves, and as credit scores start to rise.
If you are looking to transfer some of your higher-interest credit card balances, you can use one of these offers — you usually receive 0% on purchases for the introductory period as well.
Saving Money with 0% Balance Transfer Credit Cards
One of the great things about the best 0% balance transfer cards is that you can save money in interest, and pay down your debt faster.
These credit cards don’t charge you interest on the balance transfer for the introductory period, so whatever you pay goes right to your balance. This can help you get out of debt faster. Of course, make sure you pay more than the minimum to really take advantage.
Additionally, if you plan to make a large purchase and have a card that offers a 0% introductory APR on purchases, these kinds of credit cards can help you get what you want and then pay it off quickly — without paying interest at all. It’s a great way to save money instead of putting the item on a high interest credit card, or getting a loan.
Watch Out for Pitfalls
You do need to be aware of the pitfalls that can be associated with 0% balance transfer offers, though.
First of all, if you miss a payment during the introductory period, your low rate could immediately disappear to be replaced with a higher interest rate that could cost you even more in the long run. Make sure you have some system in place to make sure you pay your credit card on time.
Another concern is that it is easy to justify making large, unnecessary purchases with your credit card when you think that you won’t have to pay interest on them.
If you do use your 0 percent balance transfer credit card to make purchases, they should be items that you had already planned to purchase — and you should have a plan to repay the entire amount before the introductory period expires.
Don’t use a 0% balance transfer card as an excuse to buy something that you wouldn’t normally purchase.
Finally, understand that many 0% balance transfer credit cards come with fees.
You will likely pay a balance transfer fee of between 3% and 5% of the total balance you move to the new credit card. Double check to ensure that your interest savings will make up for the fee you pay to transfer the balance.
A hefty fee can erase all of the good you do by making the transfer. For most, the savings in being able to pay off more of the balance and pay off their credit card debt faster make the transfer fee do-able.
The Best 0% Balance Transfer Cards Available
Before you apply for one of the 0% balance transfer cards, it’s important that you understand that you need good to excellent credit to qualify. If you have fair or poor credit, you will not be offered the best terms, and almost certainly won’t receive the 0% balance transfer offer.
If you do have good credit, here are some 0% balance transfer credit cards to consider applying for (none of them have annual fees):
If the long duration 0% balance transfer wasn’t enough, the Citi Simplicity is special in that there are no late fees, annual fees or penalty rate hikes if you make a payment late.
The balance transfer fee is 3% of the transfer or $5, whichever is greater.
This is great for someone who has a large balance to transfer that will take a while to pay off and they are still working on a good system to pay their bills on time. (Citi Simplicity Review)
This card from Discover offers up a generous 18 months of 0% APR on balance transfers* (variable APR of 10.99%-22.99% after). You also get the benefit of 6 months of 0% APR on purchases* (variable APR of 10.99%-22.99% after).
Discover recently revamped their credit card lines to change how people think about their cards. Their aim is to give consumers a fair card with no annual fee, no over limit fee, no foreign transactions fee and no pay-by-phone fee. And get this, no late fee on your first late payment (but hey, aim to not pay late anyway)! And if you do happen to pay late, hey it happens, they won’t increase your APR*.
And then there’s their Cashback Bonus® program. Get 5% cash back at home improvement stores through June on up to $1,500 in purchases. Get 1% on everything else.
The new Discover it™ looks like a great card for balance transfers as well as an overall credit card.
This card offers up a o% introductory APR for 15 billing cycles on balance transfers that are made within the first 60 days of opening your accounts. You also get 0% Intro APR for 15 billing cycles, after that, 10.99%-20.99% variable APR applies.
In addition you get Purchase Replacement, $0 Liability Guarantee on fraudulent purchases, and automatic car-rental insurance.
There is no annual fee for this card.
You have 0% on balance transfers and purchases for 12 months with this credit card. After that, the APR will be 12.99%-22.99% variable based on your creditworthiness*.
The balance transfer fee is 3%.
The Dividend Platinum Select Visa also comes with a cash back program, including extra cash back on rotating categories (these change every quarter). Earn 5% cash back from Citi from 04/01/13-06/30/13 on eligible purchases at Home Depot, home furnishing stores, and home and garden stores (make sure you enroll to take advantage of the extra cash back). You earn 1% cash back on all other purchases and eligible cash advances.
There is no annual fee for this card.
Back when I got serious about getting out of credit card debt, I used a few 0% balance transfer credit cards.
I was living paycheck-to-paycheck in NYC in a small studio apartment. It was killing me that I was paying so much every month for credit cards but I was barely, if at all, putting a dent in my debt.
As my credit improved I started to see offers in the mail for credit cards. One of them had a 0% balance transfer interest rate. I applied and transfered over a balance.
I quickly saw that I was able to pay off much more of my debt when I wasn’t also paying off interest on thousands of dollars.
Zero % balance transfer credit cards greatly helped me in getting rid of my credit card debt!
All of these cards can help you save money on high interest credit card debt.
Carefully consider your options and needs before you apply. If you have a low to moderate amount of credit card debt, one of the cards with a shorter intro period and rewards might better serve your purposes.
If you have a higher balance, though, you might be better served by choosing a card with fewer frills — but with a longer period in which to pay off your debt.
*This content is not provided by Bank of America. Opinions expressed here are author’s alone, however this site may be compensated by Bank of America.
* See the online credit card application for details about terms and conditions. Reasonable efforts are made to maintain accurate information. However all credit card information is presented without warranty. When you click on the “Apply Now” button, you can review the credit card terms and conditions on the issuer’s website. Discover is a paid advertiser of this site.