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Basic Info About Credit Card Balance Transfers

A credit card balance transfer is one way to deal with credit card debt. There is a plethora of credit card providers, each of them offering various kinds of credit cards. The good thing about this is that consumers are given a wide variety of choices. This also means that the competition is so strong that each provider tries to outdo one another in order to attract more clients. The credit card balance transfer is one of those things that makes the deal sweeter for the customer.

In essence, what happens with a credit card balance transfer is that you can open a new credit card account with a different provider. You are then given the option to transfer your existing credit card debt to the new credit card. While this may not seem to make sense on the surface, perks such as lower interest rates, deferred payment schemes, and the like, make it cheaper for you in the long run.

Think about the rates on your existing credit card. The chance are that you are paying at least 16 percent APR on your existing credit card balance. If you are unable to pay off the entire balance at the soonest possible time, you will end up paying more on interest in the long run. The advantage of opening a new credit card account with a balance transfer option is that the applicable interest will only be a fraction of your existing applicable APR. More so, your payments will probably be spread out over several months.

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