Balance transfer

8 Most Common Mistakes When Doing a Balance Transfer to Eliminate Debt

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Many credit cards offer 0% APR promotional financing on balance transfers, allowing you to move debt from high-interest cards onto one that offers zero interest for an introductory promotional period. These promo periods are nothing to sneeze at. They can last as long 21 months.

So what’s the catch? The truth is that balance transfer offers can be incredibly valuable, but only when you use them properly and avoid making some common mistakes.

1. Assuming You’ll Get the Best Balance Transfer Deal

You might not always be approved for the balance transfer card you want. For example, the best 0% APR deals are only given to those with excellent credit. While you may have had excellent credit in the past, having a large balance for a long time might have caused your credit score to slip. (See also: One Ratio Is Key to a Good Credit Score)

Even if you are approved for the card, it may come with a credit line that’s substantially lower than you need. If that’s the case, you may want to consider applying for a second balance transfer card.

2. Trying to Transfer a Balance From the Wrong Card

Consumers sometimes don’t realize that you can’t transfer a balance between two cards issued by the same bank. So if you have an outstanding balance on your Chase Freedom Unlimited card, you can’t open up a new Chase Slate card and expect to transfer your balance to it.

Keep this in mind before you apply for a balance transfer card. Every time you apply for a credit card your credit score takes a little hit. It can usually recover fairly quickly, but there’s no need to ding it unnecessarily for a card that doesn’t even serve your needs. (See…