A credit card is an excellent tool to use to build your credit score. To build your credit score using your credit cards, you purchase items that you already have the money for using your credit card and then pay it off before any interest is built up. If paying the card off is not possible, you may instead choose to transfer the balance of the card to a different credit card called a balance transfer credit card. Doing so will maximize your savings by ensuring you pay the smallest amount of interest possible.
Once approved for a balance transfer credit card with a lower interest rate than the one you want to pay off, simply call and pay the original card with the balance transfer card. You are essentially paying off the first credit card with the second one. This is called balance transfer. To apply for a balance transfer credit card, you need little else other than your own information. It should be noted that oftentimes, good credit is needed to qualify for a balance transfer credit card. The benefit of using a balance transfer credit card is to transfer the balance of a higher interest rate card to a lower interest rate card. Doing so, you will save yourself the amount of money you would have paid in interest. This not only saves you actual money, it also helps you credit score from not being hurt further as it might have been if you’d taken longer to pay back the amount due to the increased cost from the additional interest.
There are many benefits to using a balance transfer credit card. Of course, there is the very obvious benefit of the amount of money you save. There is also the bonus of simplified payments. Rather than having to follow the steps necessary to pay multiple credit cards, you only have to worry about the one balance transfer card. Another great benefit of balance transfer credit cards is that you can sometimes transfer other kinds of debt than just credit card debt which is an amazing way to maximize savings. Best of all, the balance transfer credit card process is fast and easy.
There are some facts to take into consideration when using a balance transfer credit card in order to really maximize your savings. One thing to consider is that oftentimes with a balance transfer credit card, you are charged a fee called a balance transfer fee. Because there is no cap on this fee, you are charged based on how much you want to transfer. For this reason, the larger the balance you want to transfer, the more you will have to pay. To ensure that you’re saving the most possible, you may want to try transferring a small amount, if possible.
Another fact to consider is that the annual percentage rate on the card may not be permanent and although it is called a credit card, you may not be able to use the card at the same rate to make new purchases. For these reasons, it is important to make sure you know the terms of the balance transfer card to maximize your savings and avoid any hidden fees.
A balance transfer credit card is a great tool to have available. With a balance transfer credit card, you are moving from a higher interest rate to a lower interest rate. This benefits you, the card holder. This is a great way to save money.
To maximize savings using a balance transfer credit card, you need to simply put in a small amount of work. Understand what the card can and can’t be used for, what fees you can be charged with, and how long the interest rate will last are all important actors. Following these simple steps, you can be sure you’re saving the maximum amount with your balance transfer credit card.