In order to choose the best balance transfer rate you will first have to sit down and look at your budget. The rate that you will get will be determined on how long the balance transfer promotion lasts. If you have a very high debt, you will not pick a balance transfer card that has an introductory time period but will look for one that lasts for the lifetime of the balance transferred.
Featured Balance Transfer Credit Card
Make huge savings with the ANZ Low Rate MasterCard. This card offers a low interest rate for 12 months on balance transfers and a low interest rate on purchases.
- $58 annual fee
- 0% p.a. for 3 months (reverts to 13.39% p.a.) on purchases
- 0% p.a. for 3 months on balance transfers
- Cash Advance Rate of 21.49% p.a.
- 55 days interest free
- Add up to 3 additional cardholders for free.
Read the ANZ Low Rate MasterCard – Balance Transfer terms and conditions.
Featured Low Rate Balance Transfer Credit Cards:
| Interest Rate (p.a.) | Balance Transfer Rate (p.a.) | Annual fee | Cash Advance Rate (p.a.) | ||
|---|---|---|---|---|---|
 ANZ Low Rate MasterCard – Balance Transfer |
0% for 3 months (reverts to 13.39% ) | 0% for 3 months | $58 | 21.49% |
|
 Bankwest Breeze MasterCard |
0% for 6 months (reverts to 10.99% ) | 4.99% for 9 months | $49 | 21.99% |
|
 HSBC Credit Card |
17.99% | 0% for 8 months with 2% handling fee | $0 | 21.99% |
|
The best balance transfer rate
Some balance transfer cards will give you a 0% interest rate for six months. This is an incredible deal, but only if you can afford to pay back the debt within six months. If you can’t, you will have to pay the standard rate of interest after the special rate deal has expired. This can end up costing you more in interest than what you are currently paying on your existing card, in some cases, so you need to make absolutely sure that the balance can be fully paid off in six months.
Balance transfers with a low interest rate
You can get an extremely good balance transfer rate on a card that gives you 9 to 12 months to pay off your debt. You may need an introductory term that lasts longer than six months, and most of these cards have a 5% interest rate or lower. This gives you a chance to get caught up on your balance knowing that high interest charges are not being applied to your account on a monthly basis during this time.
Balance transfers for life
There are balance transfer cards that will give you a low rate of interest for as long as you need to pay off the balance. This is a great deal if you have a very high debt, or if you are having a hard financial situation and you cannot make large monthly payments. The balance transfer rate on these cards are a bit higher than the cards that give you 9 to 12 months to pay off the debt, but they are still much lower then the rate of interest you would pay on a standard credit card.
Purchase rates
You have to be careful about making purchases when you get a new balance transfer card, unless the purchase rate and the balance transfer rate are exactly the same and last for the same amount of time. Credit card companies will put your payments towards the balance with the lowest interest rate first. This means that if your purchase rate is higher than your balance transfer rate, your purchase balance will not be paid off and will sit on hold and acquire interest. This can get very costly, but it is easily avoided by not making any purchases on the card until the balance is completely paid off.
You may also want to consider getting two credit cards so that you can keep your finances organized. You can use your balance transfer credit card to handle your debt and get a separate card to make purchases.
The balance transfer rate is determined by how long you are given to pay off the balance in most cases. You will need to figure out how long it will take to pay off your debt in full and then choose the best balance transfer credit card that fits this time span.
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Posted on Saturday, December 4th, 2010 at 7:00 am
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