Balance Transfer Credit Cards

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Balance transfer cards are perhaps the single most popular type of credit card in the UK, and for very good reason. With interest rates of 0% on balances transferred for more than a full year in many cases, these cards represent an easy way to decrease your monthly outgoings and increase the amount of money you have left over to spend, invest, or pay off your debt.

Credit Card Offer Balance Transfer purchase Intro standard purchase
rate duration fee rate duration (variable)

Barclaycard Platinum Extended Balance Transfer Credit Card

One of the longest 0% balance transfer offers currently available on the market.
0% 22 months 3.2% 0% 3 months 17.5%

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Virgin Money Credit Card

0% balance transfer offer for 18 months.

Representative Example: The annual purchase rate is 16.8% p.a.(variable) so if you spend £1,200 your representative APR will be 16.8% p.a. variable% variable.

0% 18 months 2.89% 0% 3 months 16.8%

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Bank of Scotland Plus Credit Card

0% for 18 months on balance transfers & 0% for 3 months on purchases.

Representative Example: The annual purchase rate is 16.94% p.a.(variable) so if you spend £1,200 your representative APR will be 16.9% p.a. variable% variable.

0% 18 months 3% 0% 3 months 16.94%

 

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Representative Example: The annual purchase rate is 17.9% p.a.(variable) so if you spend £1,200 your representative APR will be 17.9% p.a. variable% variable.

0% 21 months 1.6% 0% 3 months 17.9%

 

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Halifax All in One Credit Card

0% balance transfers & purchases for 12 months.

Representative Example: The annual purchase rate is 17.95% p.a.(variable) so if you spend £1,200 your representative APR will be 17.9% p.a. variable% variable.

0% 15 months 0.8% 0% 15 months 17.95%

 

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Bank of Scotland All in One Credit Card

0% balance transfers & purchases for 12 months.

Representative Example: The annual purchase rate is 17.95% p.a.(variable) so if you spend £1,200 your representative APR will be 17.9% p.a. variable% variable.

0% 12 months 3% 0% 12 months 17.95%

 

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Halifax Plus Credit Card

0% on balance transfers for 17 months & 0% on purchases for 3 months.

Representative Example: The annual purchase rate is 16.94% p.a.(variable) so if you spend £1,200 your representative APR will be 16.9% p.a. variable% variable.

0% 17 months 3% 0% 3 months 16.94%

 

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RBS Platinum Credit Card

0% balance transfers for 24 months & 0% purchases for 6 months.

Representative Example: The annual purchase rate is 18.95% p.a.(variable) so if you spend £1,200 your representative APR will be 18.9% p.a. variable% variable.

0% 26 months 2.65% 0% 6 months 18.95%

 

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HSBC Credit Card

0% balance transfers for 15 months.

Representative Example: The annual purchase rate is 16.9% p.a.(variable) so if you spend £1,200 your representative APR will be 16.9% p.a. variable% variable.

0% 15 months 2.9% 0% 3 months 16.9%

 

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RBS Classic Credit Card

0% balance transfers & purchases for 13 months.

Representative Example: The annual purchase rate is 17.95% p.a.(variable) so if you spend £1,200 your representative APR will be 17.9% p.a. variable% variable.

0% 13 months 2.9% 0% 13 months 17.95%

 

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What You Need to Know About Balance Transfer Credit Cards

If you have a debt on an existing credit card which you are paying interest on, you can move the debt to a new credit card from a different card provider and make use of the balance transfer introductory offer. You can repay the debt at a special introductory 0% interest rate for a fixed period, which is typically 12 to 22 months. When the balance transfer period ends, any remaining balance starts attracting interest at a higher rate, which is usually the credit card’s standard purchase rate.

Balance transfer credit cards often also feature an introductory 0% purchase rate so you can continue to spend on the card and pay no interest for the first few months. The best way to use balance transfer credit cards, however, is to concentrate on clearing the debt before the offer expires and avoid making other transactions. You should note that certain types of transaction such as cash advances attract high rates of interest, so if you make them they can quickly negate the savings made on the balance transfer.

Other features to look out for include balance transfer fees, annual fees and rewards schemes. If the card has an annual fee it should not outweigh the saving made on the balance transfer. Rewards schemes can be useful if you can find one that suits your spending habits, but if you plan to focus on clearing the balance and not make too many purchases you are unlikely to earn many points for rewards.

In theory, when the balance transfer offer expires you should be able to move any remaining balance to a new balance transfer credit card and continue to repay with 0% interest. If you do intend to adopt this strategy you should note that each time you make a balance transfer you pay a fee, which is typically in the region of 3% of the total balance.

Used prudently, balance transfer credit cards can be a very useful financial tool. If you make the most of the introductory offer and focus on clearing the balance before it expires, they provide a great way to sort out your debts.

Making the Most of a Balance Transfer Offer

If you know how to use balance transfers to your advantage, you can save yourself a lot of money and also get yourself out of debt. Here’s how you can use them best to your advantage.

Get the longest introductory rate possible: Every time you transfer a balance from one credit card to another, you’ll have to pay a fee. These fees are usually around 3% of the balance being transferred, so they can quickly add up. One of the easiest ways to get around this problem is to get the longest possible introductory offer on interest that you can find and are eligible for. It may even be possible for you to pay off your entire debt by the time the introductory period expires, saving you the hassle of switching and the expense of paying another fee.

0% interest only: You want to save as much money as you can, so you’ll need to lock in an interest rate. The best balance transfer offers are for 0%, and you can’t get much better than that!

Don’t spend on your card: We’ll assume that you are transferring your debt to a new card at a low interest so that you can pay it off faster and live debt-free. If this describes you, then try and avoid spending with your card as much as possible. Many cards will charge you their standard purchase rate on purchases, although some will have a special introductory offer on purchases too, although the purchase rate offer tends to be for a shorter period. But for the sake of getting out of debt, spend as little as you can and concentrate on paying off what you owe.

Don’t get complacent: When you transfer a balance to a new credit card and have locked in a 0% interest rate for 12 or more months, it’s easy to forget when your promotional offer expires and you start getting charged the standard interest rate. Set up a reminder so that you know when the offer expires. If you still haven’t paid off your debt, then you can apply for a new balance transfer card.

Common Features of Balance Transfer Cards

Introductory balance transfer duration: This is the period during which the balance transfer offer is valid, typically 12 to 22 months.

Introductory balance transfer fee: A fee is usually applied when you make a balance transfer to a new credit card. The fee varies between different credit cards, but is typically 3% of the total transferred balance.

Introductory balance transfer rate: This is the rate of interest that is applied to the balance during the introductory period. Most UK balance transfer cards feature a 0% balance transfer rate while the introductory offer is valid.

Examples of Using Balance Transfer Credit Cards

Clearing a credit card debt: The best way to use a balance transfer card is to clear your debts. If you have a debt on a credit card, you can apply for a new card from a different bank, transfer the balance and repay with no interest. You should request a balance transfer when you apply for the card, and start repaying as soon as the new card arrives to make the most of the introductory offer. It is important to find a credit card with the best balance transfer terms and calculate how much you need to repay each month to clear the balance within the promotional period. Ideally, you should budget to clear the balance and avoid using your credit card for other transactions until the debt is repaid.

Saving money on your credit card balance and making purchases: Another way to use a balance transfer card is to make use of the balance transfer feature and continue to make purchases on your new credit card. An example of this could be that you have a debt on an existing credit but need to make a one-off large purchase such as a household appliance. You can select a new credit card with a competitive deal on both the balance transfer and introductory purchase rate, with a lengthy term and 0% interest on both features, transfer your balance, make the purchase, and aim to repay both within the promotional period. Again, it is crucial that you budget and plan ahead to ensure you repay within this period. If you are able to do this you will have made an interest-free loan to make your purchase and paid-off your credit card debt at the same time.

Balance Transfer Credit Card Glossary

Annual fee: This is a yearly charge that covers the general maintenance of a credit card and the costs of extra features such as rewards schemes and insurance policies. Many balance transfer credit cards have no annual fees, either during an introductory period or for the entire life of the card. If the card does have an annual fee it is important to make sure it doesn’t negate the savings made with the balance transfer.

Balance transfer: Balance transfers are a credit card feature with which you move a debt from one credit card to another card from a different issuer, and repay at a lower rate of interest during an introductory period. Items to consider when comparing, selecting and using balance transfer credit cards are the balance transfer rate, the balance transfer duration and the balance transfer fee.

Cash advance fee: A fee is typically applied to cash advances made on credit cards, typically 3% of the total value of the transaction or approximately £2, whatever of the two is higher.

Cash advance rate: This rate of interest is applied to cash advances including ATM and bank branch withdrawals and buying foreign currency. The cash advance rate is usually significantly higher than the purchase rate.

Introductory purchase duration: Many balance transfer credit cards feature a special introductory offer on both balance transferred and purchases. The length of the introductory purchase rate period varies between different credit cards, and is often shorter than the balance transfer deal.

Introductory purchase rate: Balance transfer cards that feature an introductory offer on purchases usually apply a 0% purchase rate while the promotion is valid.

Minimum payment due: This is the minimum amount you are required to pay on your monthly bill to keep your account in good order. If you are making use of balance transfers you should always aim to repay more than the minimum payment, ideally clearing the balance before the offer expires.

*Standard purchase Rate: This rate of interest is applied to any unpaid balance remaining when the introductory offer expires, and any purchases made after the introductory purchase rate period ends. It is important to know how the deal changes at the end of the promotional period and all the fees and charges that the credit card then attracts.