Playing the Balance Transfer Game
Is a Balance Transfer Always the Answer?
Many people thinking that the introduction of the balance transfer was God’s gift to the credit card world. After all, transferring your credit card balances from one credit card to another to take advantage of introductory rates so you can pay down your balance faster sure sounds like a grand plan. But is it really a good idea to constantly take advantage of balance transfer offers, or is there a drawback to that solution?
Think Twice
If you’re hopping like a rabbit from one credit card to another, you might want to think twice. Taking advantage of too many balance transfer offers too close together can actually cost you some points on your credit score.
Your credit score takes into account how long you keep your relationships with your creditors, so if you’re constantly closing accounts to take advantage of a new, lower rate it’s going to affect you adversely in the long run.
Another thing you want to consider when frequently taking advantage of balance transfer offers is whether or not there’s a fee involved. If you’re constantly paying a fee to transfer your credit card balance, you’re not really saving as much money as you think you are.