Best 0% Balance Transfer Credit Card Depends on Balance Transfer Fees
How do you exactly choose the best 0% balance transfer credit card? Well, it depends how long is the introductory offer? What is the rate thereafter? But more importantly, does it charge any balance transfer fees?
But there’s more to balance transfer fees that meets the eye. If you are not careful, that 0% teaser deal may not work out so well. A typical term for a balance transfer fee goes like this :
3% of balance transfer, mininum of $10, maximum of $75.
But, some credit card issuers have become sneaky. These are the tricks they use :
No Cap on Maximum Fees!
Yes, some credit cards offer great 0% teaser deals for balance transfer. They charge a fee, but do not cap it. Bank of America credit cards at the moment have no cap on their balance transfer fee. When there is no cap, then you are essentially not getting a 0% deal, but you are paying them 3% interest instead! Plus, it is all UPFRONT FEE! Below are Bank of America credit cards that seem to offer great 0% balance transfer deals for 12 months, but do not put a cap on the balance transfer fee.
Different Maximum Fees for Different Credit Cards
Citibank is guilty of this practice. Almost all of their credit cards have different balance transfer fee arrangements. Hence, every 0% teaser deal for 12 months is different. This is really irritating when I’m reviewing citicards and I would suspect really confusing for consumers as well. I think most consumers would not read the fine print and end up either getting a good balance transfer deal or a bad one by luck or chance! To prove my point, below is a list of citicards with 0% for 12 months balance transfer offers and their fees :
Citi Diamond Preferred Rewards Card - 3% of BT, minimumn of $5 and maximum of $250
Citi PremierPass Card - 3% of BT, minimum of $5 and maximum of $250
Citi Platinum Select Card - 3% of BT, minimum of $5 and no maximum!
Citi Diamond Preferred Card, Citi Upromise Card, Citi Home Rebate Platinum Select Card and Citi Drivers Edge have no balance transfer fee for the introductory period.
As you can see, what citicards is doing is plainly confusing. Some cards have higher caps for their balance transfer fees, and some have no balance transfer fees. I bet they are simply doing test marketing.
The low down on balance transfer fees among issuers
Bank of America - No cap to the maximum fees. Do not get Bank of America credit cards just for a balance transfer deal.
Chase - has a standard 3% of balance transfer, minimum of $10, maximum of $75 BT fee.
Discover Cards - Discover Cards have the same balance transfer fee policy as Chase. 3% of balance transfer, minimum of $10 and maximum of $75.
HSBC - If you are a HSBC bank customer, the balance transfer fee is waived if you apply for a HSBC card and do the balance transfer upon application or during the introductory window. If you are not a HSBC customer, the balance transfer fee is 3% of balance transfer, minimum of $5, and a maximum of $99. Update 6/2008 - HSBC now has also removed caps from balance transfer fees!
Citicards - Well, as mentioned above, they have different balance transfer fees for different cards. Some have no balance transfer fees during the introductory. The one good feature about citicards is that you are allowed to do your first balance transfer during the first 12 months and the 12 month introductory period starts from the date of balance transfer (not account opening date). Update 4/2008 - All of Citicards have no caps on their balance transfer fee! Hence, they are not the card you want to apply for if you want a good balance transfer deal.
So which are the Best 0% Balance Transfer Credit Cards
Well, to make life simple, these are the cards I recommend after reading every one of these fine prints.
My best recommendation would be to get the Advanta Platinum BusinessCard with Rewards. It has a 0% balance transfer deal for 15 months, the longest introductory period at this moment. It has a balance transfer fee. But a 3% of BT, minimum of $5 and maximum of $90, this is still worth doing a balance transfer if you have a large amount to transfer. Though it is a business card, you can apply even if you do not have a business. You will simply be treated as a sole proprietor. Just enter “business individual” under “business type” and “owner” under “position”.
The Discover® More(SM) Card offers a 0% APR deal on balance transfer for 12 months and cap the BT fees to $90.
The Chase Platinum Visa® Card offers new cardholders up to 12 months 0% APR for balance transfers. If your credit is not top notch, you will get a shorter period.
I hope you found this post helpful. Share any balance transfer stories you have.
July 3rd, 2007 at 9:58 am
I just did a balance transfer to BOA with the no cap of a huge amount of money, and I do not know exactly how I feel about it. It’s too late to do anything about it, so I guess me complaining about it is fruitless. Lesson learned.
AKB
July 5th, 2007 at 12:42 am
Chase United Visa - Balance transfer now has NO maximum!
BEWARE!
I have a very high credit limit and charge a lot every month and normally pay the balance in full every month.
I was waiting for my refi to come through and so used a check that says in very large font 1.99%. I wrote a check for $20,000 expecting a $75 fee. Instead I got a $600 fee!
I requested a $525 credit (to make the fee $75) - they declined.
I charge an average of at least $8000 per month on this card which would pay for that $525 credit in two months of transaction fees. Yet they are willing to drop me as a customer instead.
Personally, I think that based on this being a brand new policy that they have never done before and that the font size being so small where it is described that this is fraud. In fact it is never even described. They simply removed the words “maximum of $75″ from the fine print.
I complained and went up management on the phone only to be told that it was a valid charge and I could only dispute it in writing.
I tried using their online dispute submission - and it does not allow disputing their own charges!
So I faxed in my dispute and got a letter back that basically says too bad - the charge is valid.
I want to fight this - is it possible?
I want to complain to my state attorney general.
Yes it did say on the documentation with credit card checks that there was a 3% charge and a $5 (I think) minimum.
It merely neglected to say that there was no maximum - No comments about it in any way. Just plain removed the words “maximum of $75″ which has been on every other check from Chase for the last 10+ years I have had their card.
I will try calling again, but it seems they don’t care - they got their $600 from me and are willing to lose me as a customer forever.
I will fight this even if I cannot win as I want to make this public.
Bryan
July 19th, 2007 at 2:51 am
[...] See my post on Balance Transfer Credit Cards and Balance Transfer Fees [...]
August 6th, 2007 at 3:12 pm
You better check those Citicard terms - they are now charging 3% with no cap on balance transfers.
August 11th, 2007 at 5:21 pm
[...] Anyone considering transerring a credit card balance over to a 0% credit card? Check out this Ask Mr Credit Card post. [...]
April 14th, 2008 at 1:19 am
[...] Mr Credit Card presents Best 0% Balance Transfer Credit Card Depends on Balance Transfer Fees (Ask Mr Credit Card’s Blog) posted at Ask Mr Credit Card. [...]
April 28th, 2008 at 3:45 pm
I see you recommended the Advanta Platinum Card, even if you do not own a business. The card has a good deal, and there is also one above the platinum that starts at 0% for three months, then 2.99% fixed until payed off. There is one part where it asks you the legal name of the business. Can I make a name up, or is this Illegal?
April 29th, 2008 at 3:57 am
Just put your individual name
May 20th, 2008 at 12:50 pm
thanks for the info mr credicard. i’m interested in the advanta card but this statement worries me, ” In accordance with applicable law and the terms of your Card Agreement, we may change all of your account terms, including rates and fees, at any time for any reason. This means that your account rates, including any introductory or promotional rates offered, are not guaranteed; all account rates may be increased, fixed rates may change to variable rates, and variable rates may change to fixed rates”.
July 3rd, 2008 at 9:02 pm
[...] Best 0% Balance Transfer Credit Card depends on balance transfer fee [...]
August 10th, 2008 at 8:05 pm
I saw your suggestion for Advanta Business card and as of August 2008, the deal is:
They cap your initial credit limit at $2500, it doesn’t matter who you are. If you are wanting to do a balance transfer over this amount, you cannot. They do take balance transfers in order they are given as long as they total less then the above limit, not like some companies do - lowest from highest. The balance transfer fee has increased from what you have. It is now at $90 maximum.
I decided this wasn’t the balance transfer card for me, as my debt is $2900 and that $90 transfer fee doesn’t make it worth it (look at the fee as interest paid up front). Plus, they would only be able to take on part of my total.
August 27th, 2008 at 12:14 pm
Discover More card will not let you transfer balances from another Discover Card (my wife has one). Also, the balance transfers are up to $99 per transfer.
August 29th, 2008 at 2:19 am
My best recommendation would be to get the Advanta Platinum BusinessCard with Rewards. It has a 0% balance transfer deal for 15 months, the longest introductory period at this moment. It has a balance transfer fee. But a 3% of BT, minimum of $5 and maximum of $50, this is still worth doing a balance transfer if you have a large amount to transfer. Though it is a business card, you can apply even if you do not have a business. You will simply be treated as a sole proprietor. Just enter “business individual” under “business type” and “owner” under “position”.
When I went to apply for this card the balance transfer fee is min of $5 and max of $90, where did you obtain the aforementioned information?
August 29th, 2008 at 3:43 am
They have just increased the fee. I’ve updated the post. Thanks for pointing out.