If you come to find that you have debt spread across multiple credit cards, it's imperative to devise a plan for paying it down as quickly as possible. As you make progress, you'll begin to feel better about the future of your finances.
Many consumers trying to pay off their credit card debt turn their attention to a balance transfer credit card. There are many benefits of doing so, including the fact that you can bring all your debt under one bill -- and one payment. With all your debt combined, you'll also save money on interest.
However, before you apply for a balance transfer credit card, there are a few things you need to remember:
- You're transferring your credit card debt, not repaying it: You're simply moving your debt around, so this doesn't have any impact on your overall balance.
- You'll pay a balance transfer fee: This is typically equal to one to three percent of the balance you're transferring. So, a $20,000 transfer will set you back somewhere between $200 and $600.
- Your promotional APR will expire: Even though you'll secure a zero percent APR for a predetermined period of time, such as 12 months, it'll eventually expire. When it does, you're once again hit with a finance charge on any balance you carry.
There's nothing wrong with considering a balance transfer credit card, but make sure you know exactly what you're getting into.
If you find that moving your credit card debt around won't help you make progress, consider your other options. For example, you may be able to improve your situation by filing for Chapter 7 or Chapter 13 bankruptcy.
Attorney Advertising Disclaimer: Under Federal Law, we have been designated a Debt Relief Agency and we help people file for bankruptcy relief under the Bankruptcy Code. This information is not intended as legal advice and no attorney-client relationship is created. Results may vary. Results not guaranteed. Dramatization: Not actual clients in pictures and videos. -- Thomas C. McBride, attorney in Alexandria, LA.