Selecting the best no-fee balance transfer credit card can be time-consuming, but understanding your options can save you money. Balance transfer credit cards allow an individual to transfer and consolidate debt by moving it from one credit card to another with arguably better rates and terms. Transferring a balance often lowers the amount of money that a person needs to spend on fees and interest rates.
Not all transfer credit cards are created equal, and the introductory rates and specific benefits related to specific credit cards vary. Benzinga analyzed dozens of balance transfer credit cards in terms of APR rates, balance transfer fees and card benefits. A balance transfer credit card assists with debt and helps individuals take control of their finances.
The Best Intro No Fee Balance Transfer Credit Cards:
Best Overall: Navy Federal Credit Union® Platinum Credit Card
Best for Strong Introductory Rates: U.S. Bank Visa® Platinum Card
Best for Travel: Capital One VentureOne Credit Card
Best for Cash Back: Capital One Quicksilver Cash Rewards Credit Card
As you look to better manage your credit card debt, you need to find cards that allow for balance transfers, but not all balance transfer offers are alike. Benzinga took a look at credit card issuers that can provide you with easier ways to manage your account balance, pick up a favorable APR offer and potentially earn some bonus points at the same time.
Best Overall Credit Card for No Balance Transfer Fees: Navy Federal Credit Union® Platinum Credit Card
Navy Federal Credit Union was first founded near the end of the Great Depression. The company had originally been created to assist employees of the U.S. Navy. Today, the credit union helps individuals in all military branches as well as their family members.
The Navy Federal Credit Union® Platinum Credit Card works best for individuals that have average to excellent credit. In general, average credit is a credit score above 700. Credit scores are based on a system with numbers between 300 and 850. People with higher numbers receive better rates and terms.
APR rates have a wide range, which means you could start with a much lower interest rate. The company keeps offerings competitive by refraining from charging fees such as annual fees or balance transfer fees. The credit card provides customers with additional bonuses such as access to travel and emergency assistance.
Overall, the credit card remains competitive with the larger market, but its offer is only accessible to members of the credit union.
Pros
- As this is a credit union, you get generally better customer support
- The credit union works on your behalf
- There are added extras that you cannot get elsewhere
Cons
- The wide variation in the card’s APR could be concerning for those who are applying and don’t know what rate they will get
Best for Strong Introductory Rates: U.S. Bank Visa® Platinum Card
U.S. Bank offers multiple credit cards such as the U.S. Bank Visa® Platinum Card. U.S. Bank was first founded in the 1860s and has since expanded to assist individuals, companies and businesses with varied financial needs.
One benefit of the credit card is that it allows individuals to easily access their credit score online. Individuals have the option to create autopayments which help customers avoid making late payments. The card also includes flexible due dates where people can select due dates that work better with their schedule.
The credit card has a strong introductory APR of 0% for the first 2 years. However, once the introductory rate ends, the APR is generally competitive It charges no annual fee, but the card does include late payment fees of $41. In addition, the card includes transaction fees such as a balance transfer fee that is either 3% of the transferred amount or $5, whichever is larger.
Pros
- A long intro APR period could help you start a business or manage major family expenses
- Because you can customize your due date, you can take better care of your credit
Cons
- The long intro APR could lull you into a false sense of security as you spend for 2 full years
Best for Travel: Capital One VentureOne Credit Card
Capital One is one of the top 10 largest banks. The Capital One VentureOne Credit Card appeals to the avid traveler by offering 1.25 miles for every dollar spent. Typically the miles and rewards do not apply to balance transfers, but the travel rewards have the ability to be redeemed for additional purchases. It’s a great card for travel because it has no foreign transaction fee and provides fraud liability.
The card offers an attractive introductory special with 0% APR for the first 15 months that is combined with the option for new cardholders to obtain 20,000 bonus miles. However, the new customer must spend a minimum of $500 within the first three months of opening a card to be eligible.
However, the offer has room for improvement because of higher transfer fees and APR rates once the introductory period ends. The card is recommended for individuals with excellent credit, which might create a barrier for people that are interested in the card but that have lower credit scores.
Pros
- Travel rewards can help you if you’re often out of town for work or if you plan to take one large trip
- Consistent bonus earnings can be helpful if you want to manage daily purchases through this card
Cons
- Remember that the intro APR can help you when you first get the card, but you must be prepared to pay the higher interest rates when that promotion ends
- The option to earn a large bonus incentive may have a prohibitive threshold
Best for Cash Back: Capital One Quicksilver Cash Rewards Credit Card
The Capital One Quicksilver Cash Rewards Credit Card is one of the only cards that offers no transfer fees when a customer uses Transfer APR. The card offers no foreign transaction fees and no annual fee. Cash back can be redeemed for net purchases, so it will not apply for balance transfers. This card is a strong option for people with good credit. A potential drawback of the card is that it does not offer an introductory APR rate.
Pros
- Consistent ability to earn bonus points makes this card good for daily purchases
- Travelers will be happy to know there are not fees for foreign purchases
Cons
- You can earn bonus points with the card, but the redemption rate may not be as high as you would like
Features to Look for in a Balance Transfer Credit Card
When researching transfer credit cards, certain features offer potential drawbacks and benefits. Examine the potential benefits and rewards between the cards to have a stronger idea about how the cards compare to each other.
Length of Lowered Rates
One main benefit of the cards stems from the lowered initial rates. Decreased rates are beneficial because they assist a customer in more effectively paying off larger amounts of debt. Certain balance transfer credit cards have introductory APR rates. The introductory rates are intended to entice potential customers into joining and allow individuals to more quickly pay off debt. For example, decreased APR rates often begin as low as 0%.
For example, some people might prefer to use a home equity loan because the rate is better for longer. But, if you can handle these debts in 12 to 18 months, you may want to request balance transfer cards that will help you make a move today and avoid the closing the table.
In combination with the lowered rates, examine the anticipated time length of these balance transfers. For example, balance transfers tend to range between six months and 18 months. Explore cards that provide longer balance transfers with extended lowered rates and check the advertiser disclosure to make sure you know what you’re getting.
Hidden Fees
When comparing the different options, examine fees in detail. Certain credit cards may have higher fees that could make transferring a balance an unattractive option. Cards have the potential to charge heavy fees such as annual fees and transfer fees. Research transfer fees to understand if the various offers make sense after a deeper inspection. Attempt to calculate a rough estimate of how much you will owe in fees to have a better grasp on what you will likely pay with a certain credit card.
If the fees remain unclear, contemplate speaking with multiple customer representatives or clicking on the website for extra information. Financial institutions often maintain a webpage dedicated to addressing frequently asked questions. Individuals may find specific answers about the structure of the fees posted on one of the web pages associated with the credit card.
Also, make sure you know how much the interest charges will be when the promo offer ends. You may also need to ask precisely when the offer period will end and what the percentage rate will be, because that could be a surprise for some cardholders.
Potential Rewards
Credit cards used for balance transfers, as well as additional purchases, typically offer rewards. Rewards vary, but common rewards include cash back on purchases. Cash back is a type of reward where people purchase items on a credit card and earn a certain amount of the payment back.
For example, the cash back cards typically have different categories, and individuals frequently receive amounts such as 1% or 2% back on the previously approved categories. Read the specifics of each credit card to fully understand the cash back offers.
Remember, not all credit card balance transfers will give you these rewards.
Card Benefits
Certain credit cards within financial institutions maintain a wide range of additional benefits intended to interest both current and potential customers. The benefits depend on the specific institution, but common rewards include fraud protection and the ability to access credit scores. Customers are able to access and remain up to date on their FICO® scores from the convenience of a phone or computer. Individuals stand to benefit from the ability to easily access their credit score. Knowing your credit score can help direct future personal financial improvements. As the saying goes, knowledge is power.
How You Can Improve Your Credit Score
When contemplating how to improve your credit, first examine your credit score in addition to your financial history. A simple step such as paying off bills in a consistent manner likely boosts your credit. Individuals with improved credit scores are more likely to receive flexible terms and rates. Compare the different credit cards before applying to better understand the wider market.
Understand Your Financial History
A top priority when deciding on a credit card is understanding your financial history. Your financial history impacts the likelihood that you will be able to receive beneficial rates and terms. Consider your debt-to-income ratio to have a deeper understanding of finances. A debt-to-income ratio indicates how much a person spends in comparison to how much a person typically earns monthly. In general, lower ratios are viewed as better because the decreased ratios indicate that an individual has a lowered amount of debt. It’s important to have lower debt when viewed from the perspective of a debt-to-income ratio to avoid spending more than you earn.
Know Your Score
Before applying for a credit card, check your credit report to understand your score. Credit scores often reveal whether a certain individual is considered a reliable borrower. Credit scores usually range between 300 and 850. Higher scores are viewed as better, so people with scores above 720 receive better terms and rates on credit cards and loans.
If you are unsure of your score, research online the verified companies and websites that are able to provide your credit score information for free. Certain credit checking services have the potential to temporarily impact your credit score, so be sure to read the fine print on an agreement before looking at your score. Some credit cards offer you a view of your credit score on your monthly statements.
Pay Down Your Debt
Pay down your debt in a timely and responsible manner. If possible, avoid taking out loans or making excessive purchases that will stretch your finances too thin. Heavy debt has the potential to accumulate large amounts of interest. High interest rates make it difficult for an individual to pay off, especially for a business credit card that might incur massive charges for travel or supplies.
If you are unsure about how to proceed in terms of taking control of your debt, consider speaking with a financial professional to have a deeper grasp of the available options.
Create Your Spending Goals
When aiming for credit card approval, contemplate your larger spending and financial goals. Such goals create parameters and guidelines to help keep an individual motivated for the future. In addition, setting spending goals can help a person avoid unnecessary purchases in the future. Sticking to goals and promptly making payments on debt eventually improves your chances of obtaining a credit card with favorable terms.
How to Get Approved for a Credit Card
Getting approved for a credit card requires a strong understanding of your spending habits, credit score and financial history.
Create Strong Spending Habits
When working on getting approved for a credit card it’s important to build strong spending habits while avoiding bad credit. Keep spending grounded to a previously set budget and remain aware of set future payments such as rent and utilities.
Know Your Credit Score
A factor in obtaining a credit card is your credit score. If you are unsure about your score, use one of the reputable free services provided online. For example, certain credit cards and financial institutions allow individuals to look at their credit scores for free.
Consider Getting Preapproved
It’s possible to increase your chances of getting approved for a credit card by getting pre-approved. Research balance transfer cards to understand their specifications or consider speaking with customer representatives to more clearly understand the expectations for individual credit cards.
Remain Aware of Your Other Credit Cards
Keep in mind that your ability to pay off your other credit cards also impacts the likelihood that you will be able to obtain additional credit cards. For example, missing payments on other credit cards lower your score and negatively impact your ability to obtain additional cards in the future.
Frequently Asked Questions
What is a disadvantage to balance transfers?
Balance transfers have multiple disadvantages such as lower APR rates that last for a limited amount of time and elevated balance transfer fees. The decreased APR rates can be as low as 0% for the introductory rate. However, the low rates are only temporary and have the ability to eventually increase to rates higher than the ones offered by your previous credit card.
Before deciding on a specific balance transfer credit card, examine a company’s fee structure to understand if a specific card has high transfer fees. Transfer fees can extend up to 5% of the transferred amount in general. Such a seemingly small amount has the potential to add up when combined with larger amounts of debt. For example, 22% of $30,000 is $900 that will need to be accounted for during the balance transfer process. Be sure to find a credit card that offers limited balance transfer fees and no hidden fees to avoid potentially high charges.
One drawback of balance transfers is that certain cards require stronger credit scores. Lower credit scores will likely gain fewer benefits.
Is it possible for a balance transfer to fail?
Yes. Balance transfers can fail for a variety of reasons such as lower credit limits. For example, certain balance transfer cards have credit limits below the amount of debt that you intend to transfer. If a card has a lower limit than the amount of debt that you are trying to transfer then the transfer will not be successful. Check the credit limit on the balance transfer card and compare it to the total amount of debt that you need to transfer. Consider asking for a slightly higher credit limit on the balance transfer card to have a slight buffer. Additional fees can change the final amounts so leave a bit of room for good measure.
Another reason that balance transfers fail happens when a customer attempts to transfer balances between two cards by the same issuer. In general, it’s unusual for an issuer to permit a balance transfer between two of its cards. If possible, examine the different credit cards and select a card outside of your current issuer.
Poor credit also has the potential to hinder a person’s ability to obtain a balance transfer. Check your credit score before applying for a balance transfer credit card to see if you need to improve your score.
How do balance transfer credit cards work?
Balance transfer credit cards are credit cards designed to carry a balance between billing cycles. The final sum placed on a credit card depends on the total amount approved for transfer by the card issuer. Individuals should check how much they are permitted to transfer between cards before agreeing to a specific card. Even though many balance transfer credit cards waive fees such as APR rates during the introductory phase, it is still important to make timely payments.
Does opening a balance transfer credit card impact my credit score?
The act of transferring a balance does not directly impact a credit score, but opening a new credit card will likely lower your credit score. Opening a new credit card such as a balance transfer credit card temporarily lowers an individual’s credit score. The reason that opening a new credit card decreases the strength of a person’s credit is that it’s considered a hard pull. A hard pull occurs when companies such as card issuers or loan providers access your credit score in tandem with an application. In general, a hard pull will lower a credit score by about 10 points for around one year.
To qualify for this specific credit card, it is common for people to need credit scores above 640. Consider improving your credit score to obtain more favorable rates and terms. Improved scores can also provide a credit buffer when a hard pull impacts your credit score.
What makes a balance transfer a good idea?
Balance transfers usually allow individuals to consolidate their debt or switch to a credit card that offers better rates. The purpose of a balance transfer is to assist a person in saving money by changing to a card with more approachable rates. Balance transfers typically require individuals to have stronger credit scores and more notable financial histories. For people with higher financial scores, a balance transfer can benefit their financial situation. A balance transfer allows an individual to obtain favorable rates and terms that will likely improve their financial situation by lowering the amount of money that they will need to pay towards their balance and extra fees.