By adopting the method of Credit Balance Transfer, you can reduce the burden of interest on your credit card. Under this facility, you get your credit card debt transferred to another credit card.
Credit Card Tips: If you use a credit card then it is possible that you too may have that ‘cannot be tolerated and cannot be tolerated’ situation. That is, you may feel scared after seeing the rising mountain of interest on it, but when needed, you turn to credit card only. In such a situation, sometimes there may be a situation of paying a lot of interest, but if you want a solution to this, then there is a trick, with the help of which you can get relief from paying more interest.
Credit Balance Transfer will work
By adopting the method of Credit Balance Transfer, you can reduce the burden of interest on your credit card. Under this facility, you transfer your credit card debt to another credit card, on which you have to pay less interest. Let us tell you what balance transfer is on credit card and how you get benefit from it.
What is meant by balance transfer on credit card?
Credit card balance transfer simply means transferring the remaining debt from one credit card to another credit card. In this, you transfer the outstanding debt of your credit card to a credit card where you get loan at a lower interest rate. Now you can take advantage of this when you are not able to make bill payment on your credit card, that is, you have to pay so much interest on your credit card that it is directly affecting your budget. You can resort to this to save money on compound interest. Keep in mind that balance transfer will not reduce your debt, yes, but if used properly, you can repay your entire debt quickly with less interest.
What are the benefits of balance transfer?
You get the facility of zero interest for a limited time. If you get 0% APR i.e. Annual Percentage Rate then you can save money on interest.
By consolidating your loan, it becomes easier for you to repay the loan. This means that you can club many of your loans together in this card, with this you will have to repay the money at one place in one go.
By consolidating credit on a single card, your credit utilization ratio will remain low, which will not affect your credit score.
You may also get extra benefits like consumer protection and reward points on some balance transfer cards.
To transfer balance, you will have to pay balance transfer fee. Under this service you have to pay 3 to 5% fee of your total balance.
While transferring the balance, you should ensure that you fulfill its conditions and requirements. Otherwise, what would happen is that you got the balance transferred, but you did not change your spending habits, due to which your earlier debt remained intact, but your expenditure on this new card increased even more.
You should also know that for balance transfer your credit score should also be good. Banks give preference to good credit score for this.
Finally, when you do a balance transfer, you will want to try to pay off your loan before the introductory APR offer expires. That is, repay your loan within the period of low interest you are getting, because after this period ends, you will have to pay interest at regular APR, due to which balance transfer will not have much meaning.
