No fee balance transfers are the best deal in the credit card market. Not only do you get up to 1 year to enjoy a money saving 0% APR, you can also save anywhere from a few dollars to a few hundred dollars on balance transfer fees. I’ve received a number of emails from visitors of SmartBalanceTransfers.com asking for an explanation of how it is possible to save hundreds of dollars with a no fee balance transfer, so I will answer this question here.
With 99% of credit cards, there is a 3% balance transfer fee. With most of these credit cards, the maximum balance transfer fee is $75. With others, the maximum fee is $99. With others, there is no limit on balance transfer fees. Since most credit cards charge 3% with a maximum of $75, we’ll focus on how no fee balance transfer fees help you save compared to the standard offer.
The standard balance transfer credit card charges 3% for each balance transferred, not for the total amount transferred. If, for example, you are transferring a $7500 balance from 1 credit card, you’re total balance transfer fee will be $75 or only 1% of the balance transferred. However, if you spread this amount to 3 cards with $2500 balances, your balance transfer fees skyrocket to $225 or $75 per card.
Clearly, a no fee balance transfer credit card offers substantial savings over a 0% balance transfer credit card that charges a balance transfer fee, especially when you transfer balances from multiple cards. However, when you are only transferring balances from a single card, a no fee balance transfer may not always be the best option. The reason for this is straightforward. No fee balance transfers rarely, if ever, offer a 0% APR on purchases. If you know you will be spending more money on your credit cards during the next year, apply for a credit card that offers a 0% APR on purchases and balance transfers may provide more savings than a credit card that offers only 0% APR no fee balance transfers.
For example, if you spend $2000 on your old credit card with an average interest rate of 14%, you could pay up to $300 over the course of a year in interest. In other words, four times what you would pay in balance transfer fees if you only transfer one balance.
Ideally, transferring your balances to a 0% APR, no fee credit card and not using credit cards at all would save you the most money. However, if you will be using a credit card, you may want to consider applying for a no fee balance transfer credit card and a credit card that offers a 0% APR for 1 year on purchases or, to simplify things, applying for a credit card that offers a 0% APR for 1 year on both purchases and balance transfers.
At SmartBalanceTransfers.com, you can compare current 0 APR no fee balance transfer credit cards and apply online.
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