A balance transfer card is a credit card that lets you move existing debt from another card onto a new one, usually to take advantage of a lower introductory interest rate on the transferred balance. The goal is straightforward: give yourself a window of months or years to pay down what you owe at a lower cost, then pay off the balance before that window closes and the standard rate kicks in.
Two things separate a useful balance transfer card from a disappointing one. The first is the length and quality of the introductory period, including whether there is an annual fee during it and whether the card also applies the promotional rate to new purchases. The second is the cost of the transfer itself, since most issuers charge a fee per balance moved, and a high fee can erase the savings from a low introductory rate.
When comparing options, weigh the introductory rate window, the transfer fee, the regular purchase APR that follows, and any annual fee. Make sure the estimated savings from a lower rate exceed the fee, and that you can realistically pay off the balance before the promotional period ends.
