How this calculator works
Both options are paid down month by month at the same payment. The current card charges its APR throughout. The new card starts with the balance plus the transfer fee, charges the intro APR for the promo months and the go-to APR after that. Savings are the interest on the current card minus the interest and fee on the new one.
Worked example
With the example values below: Estimated savings, $2,043 (by transferring the balance). Change any number above to run your own.
What you enter
| Input | Example |
|---|---|
| Balance to transfer | $8,000 |
| Current APR | 24% |
| Monthly payment | $400 |
| New card | |
| Intro APR | 0% |
| Intro period | 18 mos |
| Transfer fee | 3% |
| APR after intro | 22% |
How a balance transfer works
A balance transfer moves debt from one or more credit cards onto a new card, usually one offering a 0% or low introductory APR. The new card pays off your old balance and you owe the new issuer instead. While the intro rate lasts, all of your payment goes to principal, so the balance falls much faster.
Most cards charge a balance transfer fee of 3% to 5% of the amount moved, and it's added to the new balance on day one. Intro periods usually run 12 to 21 months. After that, any remaining balance is charged the card's regular APR, which is often above 20%.
When a balance transfer is worth it
A transfer pays off when the interest you avoid is larger than the fee. On an $8,000 balance at 24%, a 3% fee costs $240, while a year of interest on the old card would be well over $1,000 if you pay it down slowly. The calculator compares both paths at the same monthly payment so you can see the net savings.
The math works best when you can clear most or all of the balance before the promo ends. Divide the balance plus the fee by the number of intro months to find the payment that gets you to zero in time.
- Good fit: you have a plan to pay the balance off within the intro period and won't add new charges.
- Weaker fit: you can only make minimum payments, so most of the balance will roll into the go-to APR.
- Poor fit: the transfer fee is high and the balance is small enough to pay off in a few months anyway.
Rules and fine print to check
You usually can't transfer a balance between two cards from the same bank. Many offers require the transfer to be completed within 60 days of opening the account to get the intro rate. New purchases on the card may not get the 0% rate, and payments above the minimum are generally applied to the highest-rate balance first, so it's simplest not to use the new card for spending.
A missed payment can end the promotional rate early. Set up automatic payments for at least the minimum, then pay extra on top.
Alternatives to a balance transfer
If you don't qualify for a good transfer offer, or the balance is too large to clear in 21 months, a debt consolidation loan can lock in a fixed rate and a fixed payoff date. If you'd rather keep your cards, use the credit card payoff calculator to find the payment that clears the debt by a date you choose.
Frequently asked questions
Is a balance transfer a good idea?
It is when the interest you save is more than the transfer fee and you can pay off most of the balance before the intro APR ends. Moving $8,000 from a 24% card to a 0% card with a 3% fee costs $240 up front but can save over $1,000 in interest.
How much is a balance transfer fee?
Usually 3% to 5% of the amount you transfer, with a minimum of about $5 to $10. A few cards waive the fee for transfers made in the first 60 days. The fee is added to your new card's balance.
Does a balance transfer hurt your credit score?
Applying for a new card causes a hard inquiry and lowers the average age of your accounts, which can dip your score slightly for a few months. Over time, paying the balance down lowers your utilization, which usually helps your score more than the inquiry hurt it.
What happens when the 0% intro APR ends?
Any balance left over starts being charged the card's regular APR from that point on. Unlike some store cards with deferred interest, standard balance transfer cards don't charge interest retroactively on the amount you've already paid.
Can I transfer a balance to a card from the same bank?
Generally no. Issuers don't allow transfers between their own cards, so you'll need a card from a different bank to move the balance.
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