In this article, I will try to explain to you what is a balance transfer. This method can be used in various ways and most commonly, people use it to get out of debt or to make getting out of debt easier.
Ok so what is balance transfer? Balance transfer or credit card balance transfer it a process in which you transfer your balance from one credit card to another. Simple as that, but why would anyone want to do that? The most common reason is lower APR. What is APR? APR stands for annual percentage rate and it means how much you will pay for the money you owe. I said that the most common reason for balance transfer is lower APR, how low can it be?
Annual percentage rates vary from credit card to credit card but they are usually between 3-6% per year. However some credit cards have much lower interest rates. Many of hem offer some sort of introductory interest rates. For example Zero APR Discover is one way to go when looking for 0 % introductory APR.
Please note that sooner or later this 0% introductory interest rate goes away. So make sure you check your future costs for that credit card. OR, you can keep switching between credit cards and pay an introductory interest rate the whole time. But that will take a lot of time and work.
Always try to keep your debt low but also make sure you pay as little as possible for your borrowed money.