The balance transfer market continued to tighten over the past few months, with more and more companies raising fees, eliminating no fee offers, and tightening the credit requirements for approval.
Discover, the last major bank to cap balance transfer fees at $75 per transaction, is now charging a full 3% on all balance transfers. This is unfortunate as it leaves consumers with virtually no option of getting a 0% APR balance transfer for a full year without paying a full 3% balance transfer fee.
Bank of America also added to the balance transfer market malaise by removing the last major bank issued credit card that charged no fees and offered a 0% APR for 6 months. Although this card offered no fee balance transfers, the APR after the introductory period was 14.99%, making this offer good only for those who could afford to repay their balance in full during the introductory period.
Capital One does offer no fee balance transfers with one of its card. However, this card has some big drawbacks. First, it does not offer a 0% APR; instead, it offers an 8.9% variable APR. In about four months, the money you would have spent on fees will be spent on interest.
The second drawback to this no fee offer is that the credit card is designed for people with average credit and has a maximum credit limit of $3000, generally less than most would need.
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