NEEP FINANCIAL ADVICE!!!!
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NEEP FINANCIAL ADVICE!!!!
| Mon, 03-21-2005 - 9:39am |
Okay, I keep getting from these credit card companies about balance transfers for like 2.9% until I pay it off, etc. I was wondering if it's good to do that, and it won't look bad on your credit?? Have anyone else experienced this? If so, please let me know if it's good to do it..because I want to hurry up and pay off these two high credit cards before I get married this year...it's so bad always being broke! Thanks for the advice in advance.

Generally speaking, it is good to transfer higher rate debt to lower interest debt.
All my best,
Danni
There are a few things you can do to determine if the offer is a good one. First, what type of limit are they offering? Is it enough to transfer both your balances too? Even if they say they will give you a limit up to $10k, they still will process your application and determine if they can give you the offer based on your credit history and score. Have you checked your score recently? Knowing your score is a good way to get an idea if you will get approved.
What are your interest rates on your other cards? Is there a balance transfer fee? Is there an annual fee? Will they hike up your rate if your credit score changes of if you are late on a payment? Is there a different rate for new purchases vs. the transfered balance? Definitely read *all* of the fine print on the offer. If there is a balance transfer fee, how much is it? Are you sure the lower interest rate applies for the life of the card, not just for a certain period?
Generally if you have an offer for 2.9% for the life of the balance and no transfer fee (or only a small one-time fee) that is a good idea. Transfering balances will not hurt your score in the long run. For a month or so your credit might show a balance on both cards (the transfer being reflected but the pay-off not yet reflected) but that will only be short-term and will resolve itself. Opening a new card can sometimes ding your score, but it is more likely to be the case when you open more than 3 cards within 6 months or a year, one new card isn't usually a bad thing. Don't close the old card, just leave it open with a zero balance. Doing this will increase your total available credit (the sum of all three credit limits) and that is usually good for your score.
Once you transfer the balance, be sure to pay every payment on time (a few weeks early to be safe). Missing a payment will usually get you a nice high interest rate and some extra fees. Also, do not use the new card for new purchases, as often the new purchases get a higher interest rate and payments are applied to the higher rate balances first (also, charging new purchases make it hard to get out of debt). Do not keep the cards with you and possibly consider ripping them up (you don't have to have a card to keep the account open), that will help you get out of debt faster by forcing you to live on only your income.
I got my Capital One about balance transfers it's 2.99% FIXED APR. In the fine print it say: See back of letter for the Important Notice and the terms and conditions for using the checks.
Rates are subject to change if you do not keep your account in good standing as previously disclosed. All transactions with this offer are subject to a processing fee of 3% of each transaction amount of 50$ per transaction, whichever is less. This fee is considered a FINANCE CHARGE.
IMPORTANT NOTICE:
By using a Select Check or transferring a balance with this offer, you agree to a change in your Capital One credit card account ("Account"), including an additional balance segment. This will also include a change in the application of your payments. (Payments will first be applied to finance charges and fees, then to the Special Transfer segment, next to the Cash Advance segment and finally to the Purchase segment.) If your Account does not currently have a Special Transfer segment, one will be created for your Account. All Special Transfer balances will be posted to the "Special Transfer" segment of your Account and the totoal Special Transfer segment balance will be subject to the annual percentage rates and terms described below. The change will becomes effective on the first day of the Billing Period during which Capital One approves and processes your request for a Special Transfer.
You may not avoid finance charge on your outstanding Special Transfer balance and new SPecial Tranfers (those billed to your Special Transfer segment). Finance charge for new transfers will be assessed from the date of the transaction or from the date the transaction is processed to your Account orr from the first calendar day of the current Billing Period. Finance charge will continue to accrue until your Special Transfer balance is paid in full.
For further explanation of how the finance charge is calculated for your Account, please refer to the Section title "FINANCE CHARGE" in your Customer Agreement.