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What is a balance transfer fee?
A balance transfer fee is the charge for each time you transfer a balance from one credit card to another credit card. Usually you do this because you are moving your balance from a high interest rate credit card to a 0 APR credit card or low APR credit card and pay a lot less interest. The transfer is done with special checks or forms, or may be offered as an option on some credit card applications, or it can also be done by calling your credit card company and giving them the details about the account you are paying. If you use this method wisely, it can save you a lot of money in interest when you carry a balance over time.
Credit card companies sometimes offer teaser rates to encourage balance transfers coming in and balance transfer fees to discourage them from going out to other credit cards.
See also:
What is a balance transfer?
What is a balance transfer check?
How is my balance calculated every month?
How does a credit card work?
Last update: 2006-09-25 16:40
Author: BKO
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