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Best Balance Transfer Credit Cards

Best Balance Transfer Cards feature image

Published on:

Written by: Michael Barton

Published on:

Written by: Michael Barton

Michael has almost quarter of a century’s experience in the financial world. This includes trading and institutional sales trading, and in senior positions to VP of Global Equities, as well as Head of Trader Training, at companies including Merrill Lynch (SNC), Cargill Investor Services, and Goldman Sachs. Michael’s experience also extends to providing financial advice as a personal financial advisor in the UK.
This article has been fact checked by a member of the Wallet Savvy editorial team and complies with our editorial standards.

Transferring a high-interest debt to a card with 0% interest is a fantastic solution to clearing your debt. Here, we circle the best balance transfer cards available today, and show you how to squeeze all the juice from them sensibly and effectively.

Balance transfer cards are like music to my ears! Why? Because it replaces bad credit card debt (with their high interest rate trap) with good credit card debt (zero interest to pay).

If you have a balance on an existing card on which you are paying interest, you could save hundreds, perhaps thousands, by switching to a balance transfer card. Plus, if you use balance transfer cards effectively, you could free up money to work harder for you.

In this article, I answer all your questions surrounding the pros and cons of balance transfer credit cards, how to use them properly, the pitfalls to avoid, and, of course, which are the best balance transfer cards available.

Quick Verdict: Best Balance Transfer Cards

Best For Longest 0% Interest Period: Barclaycard Platinum Balance Transfer Card*

Best For Combined 0% Interest Length & Fee: Santander Everyday Long Term Balance Transfer Credit Card*

Best Zero Transfer Fee Card: NatWest No-Fee Balance Transfer Card*

Best For Poor Credit Scorers: Virgin Money For Poor Credit*

*All fees, charges, and T&Cs may change – please check before applying.

Whichever is the best balance transfer card for you, it’s crucial that you plan your financial strategy to achieve your goal of becoming debt free with a brighter financial future.

Why Is A Balance Transfer Card Good Debt?

You’ve got existing credit card debt, and the balance is out of control. Not surprising, really.

Even if you’re not using the card for purchases any longer, the interest rate is likely to be north of 20% – you’ve found yourself in the high interest rate trap. Your balance never seems to get smaller, does it?

Imagine transferring that balance to a card that doesn’t charge interest – and promises not to for, say, 24 months or longer.

No interest to pay. A known amount of debt. A card balance that reduces faster. More cash in your pocket, instead of the credit card issuer’s vaults. Welcome to the world of balance transfer cards.

How Does A Balance Transfer Work?

A balance transfer card lets you move existing credit card debt to a new card with a different card provider. You’ll pay interest at a special promotional rate – often 0% (no interest) – for a specified period, which is typically between 12 and 29 months.

During the no-interest window, every pound you pay goes to paying off your debt. This saves you money and makes it easier to repay your debt faster.

You can use a balance transfer card strategy as part of a debt consolidation plan, simplifying your payments, saving money in interest, and making budgeting planning easier.

Providing you stick to the rules, it’s a smart financial move to make.

How Much Could A Balance Transfer Card Save Me?

Let’s get to the nitty gritty – how much could you really save by transferring to a 0% balance transfer card?

Let’s suppose you have a balance of £3,000 on your existing card(s) with an interest rate of 30% per year. I won’t go through the maths, but if you maintain that balance throughout, you’ll be paying £73.80 in interest each month. That’s £885.60 a year.

If you pay £125 per month, it will take you around 38 months to repay the balance in full. The total interest alone that you’ll pay is approximately £1,750.

Should you transfer your £3,000 balance to a balance transfer card with 0% interest for 24 months, you could pay the same £125 per month to clear your debt and save £1,750 in interest – and have an extra £125 in your pocket every month after two years.

(Remember, this is only an illustration – the actual amount you could save depends upon how much you owe, the amount you repay each month, and the terms and conditions of your card providers.)

The Pros & Cons

On the face of it, applying for a balance transfer card is a no-brainer. In fact, it’s so good you might be asking why credit card providers would offer them.

Here’s where you need to be clear about the advantages and disadvantages of this financial tool – if you keep in mind that banks and other financial institutions don’t do ‘owt for nowt’, you’ll be on the right lines to making better financial decisions.

The Pros Of Balance Transfer Cards

I’ve discussed the major advantages of balance transfer cards already – you could make significant savings on interest payments which makes it easier to reduce your debt faster.

A balance transfer card can also help to consolidate your debts, making it easier to manage your budget. A single payment also makes it less likely that you’ll miss a payment, which reduces the risk of late payment charges.

Combining all these pros, using a balance transfer card could also help to improve your credit score over time – providing you remain responsible in how you use your card.

The Cons Of Balance Transfer Cards

Now, for the drawbacks – it’s not all a bed of roses.

First, it won’t reduce your debt. In fact, initially your debt will increase. This is because your new card provider will usually apply a transfer fee – typically between 1% and 5% of the total balance you are transferring.

Most balance transfer cards require you to have a good credit score – which makes it more challenging if you have a low credit score (though it’s not impossible). You will probably also suffer a temporary hit to your credit score, because your application is likely to involve a hard credit check into your credit report.

You’ve also got to be disciplined, because the temptation will be very strong to spend on your new credit card, especially if the 0% interest on the transfer amount is supplemented by an interest-free promotion on new spending.

Your interest rate will jump at the end of the interest rate free period, or if you fail to make payments on time. If you haven’t cleared the balance, you might face higher interest rates than previously.

Why Do Banks Offer Balance Transfer Cards?

If you’re a sceptic like me (and it’s not a bad thing to be curious), you’ll want to know why banks and other card providers offer balance transfer cards with 0% interest rates. There are three main reasons:

  • They want your business, and hope you remain a customer for life – it’s a long-term game with long-term rewards for them.
  • They want you to spend new money on your card – and earn themselves interest from that.
  • They’re happy for you to break the T&Cs such as making a late payment, because they will start charging you high interest rates immediately.

The Best Balance Transfer Cards

Now we’ve covered the basics, let’s look at the best balance transfer cards available today, and how you could repay a £3,000 balance.

Barclaycard Platinum Balance Transfer Card

Best For Longest 0% Interest Period

  • 0% Period: 28 months
  • Balance Transfer Fee: 3.45%
  • Standard APR: 24.9% after the 0% period ends
  • Fee Amount: £3,000 x 3.45% = £103.50
  • Total Initial Balance: £3,103.50

Monthly payment to clear in 28 months: £3,103.50 / 28 = £110.84

*All fees, charges, and T&Cs may change – please check before applying.

Santander Everyday Long Term Balance Transfer Credit Card

Best For Combined 0% Interest Length & Fee

  • 0% Period: 26 months
  • Balance Transfer Fee: 3%
  • Standard APR: 23.9% post the introductory period
  • Fee Amount: £3,000 x 3% = £90
  • Total Initial Balance: £3,090

Monthly payment to clear in 26 months: £3,090 / 26 = £118.85

*All fees, charges, and T&Cs may change – please check before applying.

Virgin Money Balance Transfer Credit Card

  • 0% Period: 27 months
  • Balance Transfer Fee: 3.25%
  • Standard APR: 24.9% after the 0% period
  • Fee Amount: £3,000 x 3.25% = £97.50
  • Total Initial Balance: £3,097.50

Monthly payment to clear in 27 months: £3,097.50 / 27 = £114.72

*All fees, charges, and T&Cs may change – please check before applying.

HSBC Balance Transfer Credit Card

  • 0% Period: 26 months
  • Balance Transfer Fee: 3.49%
  • Standard APR: 24.9% after the 0% period
  • Fee Amount: £3,000 x 3.49% = £104.70
  • Total Initial Balance: £3,104.70

Monthly payment to clear in 26 months: £3,104.70 / 26 = £119.41

*All fees, charges, and T&Cs may change – please check before applying.

Best Balance Transfer Cards With No Transfer Fees

To save even more money on combined interest and transfer fees, you could opt for a transfer-fee free card.

However, these cards have a shorter 0% interest rate period, meaning your monthly payments will be significantly higher to pay off the balance in full before you get whacked with high interest rates:

Barclaycard No-Fee Balance Transfer Card

  • 0% Period: 12 months
  • Balance Transfer Fee: £0
  • Standard APR: 24.9% after the 0% period
  • Total Initial Balance: £3,000
  • Monthly Payment to Clear in 12 Months: £3,000 / 12 = £250

Monthly payment to clear in 12 months: £3,000 / 12 = £250

*All fees, charges, and T&Cs may change – please check before applying.

NatWest No-Fee Balance Transfer Card

Best Zero Transfer Fee Card

  • 0% Period: 13 months
  • Balance Transfer Fee: £0
  • Standard APR: 24.9% after the 0% period
  • Total Initial Balance: £3,000

Monthly payment to clear in 13 months: £3,000 / 13 = £230.77

*All fees, charges, and T&Cs may change – please check before applying.

Best Balance Transfer Cards For Poor Credit Score

If you have a poor credit score, all hope is not lost. There are balance transfer cards made especially for you, and our pick of them is:

Virgin Money For Poor Credit

Best For Poor Credit Scorers & Longest 0% Interest Rate Period

  • 0% Period: 16 months (assuming a history of managing credit even with past CCJs or defaults)
  • Balance Transfer Fee: 3%
  • Standard APR: 29.9% after the 0% period
  • Fee Amount: £3,000 x 3% = £90
  • Total Initial Balance: £3,090

Monthly payment to clear in 16 months: £3,090 / 16 = £193.13

Additional Features: Longest 0% period available for poor credit scores; minimum personal income of £15,000 required.

Zopa Poor Credit Balance Transfer Card

  • 0% Period: 6 months
  • Balance Transfer Fee: None
  • Standard APR: 34.9% after the 0% period
  • Fee Amount: £3,000 x 3% = £90
  • Total Initial Balance: £3,090

Monthly payment to clear in 16 months: £3,090 / 16 = £193.13

Additional Features: No fee for the balance transfer; suitable for individuals with a modest income and active credit lines.

Pitfalls To Avoid

To maximise the benefits of a balance transfer card, there are a few pitfalls you’ll need to avoid:

Most balance transfer cards come with a transfer fee. This will increase the amount you owe.

You should calculate this against the interest you will save by transferring existing credit card balances, and when comparing balance transfer cards, too.

Making only the minimum payment required each month will make your repayment period longer, and could result in you hitting a wall at the end of the interest-free period.

That wall could be an insurmountable balance to pay, resulting in high interest on any remaining balance owing.

Most balance transfer cards charge interest on any new purchases you make. Depending on the card, this interest may start to accrue immediately.

The result? The advantage of zero interest on your balance transfer starts to erode, and repaying the balance before the end of the interest-free period becomes more difficult.

From the outset, plan for the end of the interest-free period. It has a tendency to creep up on you, and the interest rate applied after this point can hurt if you haven’t reduced your outstanding debt significantly.

(Tip: Set up monthly reminders on your calendar to alert you from at least six months before the end of the interest-free period.)

Here’s a pitfall that might surprise you. The idea of transferring existing balances to a balance transfer card is to take advantage of lower interest rates, but to do so you’ll need to be disciplined and resist the temptation to continue using your existing cards that have helped to get you into a debt mess.

The easiest way to do this is to close the accounts, isn’t it?

However, if you close existing accounts, you could take a hit to your credit score. This is because it decreases the amount of credit available to you and therefore increases your credit utilisation ratio (the amount of credit you are using against credit available to you).

The answer to this conundrum? Cut up your existing cards, but don’t close the accounts yet.

It might be tempting to constantly transfer balances to new balance transfer cards, but doing so could lead to accumulating transfer fees and a negative impact on your credit score, which will harm your ability to get credit in the future.

What You Should Do

So now you know what not to do, I’ve found it pays to adopt a few key strategies to get a balance transfer card to work for you and not the card provider:

Figure out how much you need to repay each month to clear the balance before the interest-free period is up, and stick to this payment. The easiest way is to set up a standing order each month.

Your goal should be to reduce and eliminate your debt, not add to it. The best way of doing this is not to use the card to make new purchases that could add to your balance and accrue interest.

Credit card debt is often the worst debt to have. A balance transfer card turns this rule on its head – it’s now the cheapest debt you might have.

If you do have other debt on which you are paying a higher interest rate, focus on paying this off first – but don’t forget to make at least the minimum payment on your balance transfer card each month, and make sure you can repay the full balance before the interest-free period ends.

Monitor your card balance every month, and recalculate how much you need to repay monthly.

Don’t allow this to stretch beyond your means. Relying on future luck is no way to budget for a debt-free life.

If you plan for the worst-case scenario, you are more likely to repay your debt in a timely fashion. For example, plan to pay at least the monthly amount required to clear the full balance before the end of the interest-free period – and more if you can.

Don’t rely on the bonus from work that you’ve always received, because it may not arrive next year.

Follow this strategy and any financial windfall you receive can be used to enhance your financial future and current lifestyle – and any financial disappointment will be much easier to take in your stride. (A lesson I learned in the toughest way, when the company I was working for back in the day paid no bonuses for two years and credit card debt nearly destroyed me.)

How To Apply

You’ll need to apply direct to the card provider. Most will require that you have:

  • A good to excellent credit score (you can improve this by paying down other debt and ensuring you don’t make any late payments on your existing credit arrangements)
  • A stable income, which you may need to demonstrate by providing pay slips
  • A low credit utilisation ratio, generally below 50%

Before applying for a balance transfer card, you should:

  • Review and correct your credit report
  • Compare balance transfer cards
  • Use an eligibility checker to avoid unnecessary hard credit checks
  • Gather all information/documentation needed to support your application

If possible, apply for a balance transfer card when your credit score has received a boost – perhaps when you have received a bonus from work and reduced your existing credit utilisation ratio.

What Should I do If I Can’t Repay In Time?

Even the best financial planning can take a beating should circumstances conspire against you. A period of illness, unexpected job loss, or other financial emergency can have a devastating effect on your bank balance and ability to cope with existing debts.

If you’re struggling to repay your 0% balance transfer before the interest-free period ends, there are options open to you, including:

  • Applying for another balance transfer card with a 0% introductory rate (ensure the transfer fee is less than the interest you would save by transferring).
  • Negotiating a payment plan with your existing card provider to extend your repayment period or lower your interest rate.
  • Applying for a debt consolidation loan to put all your debts into a more manageable credit arrangement.
  • Seeking financial counselling to help you create strategies to manage your debts effectively. Organisations like Citizens Advice and National Debtline are free to use and can offer advice over the phone or online.

Whichever route you choose, remember that effective budgeting lies at the heart of good financial management.

Switch Off High Interest Payments With A Balance Transfer Card

Credit cards certainly have their place in your financial armoury, but it’s easy to abuse them. If you have fallen into the high interest rate trap with spiralling debt, transferring balances to a card with a 0% interest period can help you regain control of your finances.

However, to maximise the benefit of these cards, it’s crucial that you avoid pitfalls such as making late payments, not planning to repay your balance effectively, and adding to your balance.

You’ll need to keep your financial discipline to clear your debt before the interest-free period ends – your goal should always be to repay what you owe, and not to increase your debt.

In short, with careful planning and a strategic approach, a balance transfer card can be your steppingstone to becoming debt free with a brighter financial future.

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