If your current credit card has a high annual percentage rate (APR) or you have more than one card that you’re trying to pay off, then it’s probably time to find a balance transfer credit card that serves you better. You might be tempted to choose the first option that comes your way with a 0% introductory APR, but in order to find the best card that meets your needs in both the short-term and long-term, you need to dig a little deeper into the fine print. You may find that a credit union credit card will provide you with better features than a credit card from a bank.
You deserve consumer-friendly terms
Banks have shareholders that expect to see a profit. While they can have attractive offerings, shareholders come first, not customers. Credit unions, on the other hand, are not-for-profit financial cooperatives. Their entire purpose is to serve their members, and therefore they roll any profits back into services. In terms of balance transfer credit cards, this means that the best credit unions are able to offer their members lower rates, no transfer fees, and competitive rewards.
If your primary goal is to find a balance transfer credit card that offers you a 0% APR for enough time that you can make serious inroads toward paying off your credit card debt, then a credit union may be able to offer you exactly what you’re looking for. Choosing the right card for you will depend on the length of the 0% balance transfer APR period, any balance transfer fees, ongoing APR, etc. The right credit card can literally save you hundreds of dollars. For instance, at OCCU, we offer four credit card options, all of which include 0% introductory APR on balance transfers for different amounts of time. We give our members low rates, no fees, and rewards like cash back, gift cards, travel rewards and merchandise. We’re able to do this because of our not-for-profit, members-first structure.
What to look for in a balance transfer credit card
- Look out for balance transfer fees—It goes without saying that the primary things you’re looking for in a balance transfer credit card is low APR and no fees. When you see an introductory 0% APR offer, be sure to find out if there will be a balance transfer fee. The credit card may have no annual fee, but charge you a balance transfer fee that can add up quickly. The fee is calculated on the total amount you’re transferring. If that balance transfer fee is 3%, for example, and you want to transfer $10,000 from another credit card, you’ll be paying a $300 fee right off the top. Depending on how much money you'll save on interest over the life of the debt, a credit card with a balance transfer fee may not be worth it.
- Look out for late fees—Some credit card companies have rules that make it easy to slip up and lose your fantastic introductory APR rate. For instance, if you make a payment late one month, you may be charged a late fee and lose the introductory APR that made the balance transfer credit card so appealing in the first place.
- Look out for credit cards with high APR after the introductory period—A balance transfer credit card should give you a very low APR. An introductory 0% APR will go a long way toward letting you pay down your debt. However, that amazing introductory rate won’t last forever and some credit cards then increase the APR substantially. If you’re not careful, you can find yourself still having significant debt and a higher interest rate than you had on the card(s) you transferred your debt from originally. Unless you know for sure that you can pay off your debt during the introductory APR period, you want to find a balance transfer credit card that also has low rates after the 0% goes away.
- Don’t forget about theft and fraud protection—These days it’s important to keep a close eye on your credit cards in order to protect yourself against theft and fraud. As you’re researching balance transfer credit cards, make sure you’ll have the kind of microchip technology and fraud protection you need. For instance, at OCCU, our members have zero fraud liability on their credit union credit cards, whether they’ve chosen our NICE PERKS® Platinum Visa®, the NICE® Platinum Visa®, The Duck Card, or The Beaver Card. All of these cards also include secure microchip technology that is compatible with Apple Pay.
- You deserve rewards—Some balance transfer credit cards offer great introductory APR, but no rewards. Rewards may not matter to you when what you really care about is getting your debt paid down, but if you can have your cake and eat it too, then we say why not both have? Because of our not-for-profit structure and commitment to give our members every benefit we can, we’re able to offer competitive reward programs on our Duck, Beaver and NICE Visa cards, along with 0% introductory APR* on balance transfers, no annual fee, no foreign transaction fees, and a host of other membership benefits and services that save our members money.
If you’d like to learn more about a credit union balance transfer credit card, reach out to OCCU. We’re happy to help!
*Review the additional terms and conditions on our credit card options.