Report on Balance Transfer Credit Cards (Forbes)   Leave a comment

For some, balance transfers on credit cards are a fabulous thing. A credit card balance transfer is the moving of credit card debt from one card to another. Many people use balance transfers to pay down the balance on a credit card without incurring interest charges. According to an article from www.smartbalancetransfers.com, June was a good month for these sorts of transactions.

In June, consumers enjoyed a 5% decrease in average balance transfer fees. Offers for 0% balance transfers increased slightly, the second increase in 2011. Still, even with these positive developments, the users of balance transfer options remain miniscule. The consumer marketplace for these offers is still weak and developing.

The Three Medalists credit

As of right now, Citi balance transfer promotions are the best and get the gold medal from us. The Citi Platinum Select, Citi Diamond Preferred and Citi Simplicity cards are crushing their competition, offering users 0% rates on balance transfers and purchases that last 21 months, the website says. These offers are three months longer than the next best transfer offer.

But Discover is catching up, coming in at a close second, earning a silver medal. Discover balance transfers give users an 18 month promotion. This month, they even reduced the balance transfer fees on their initial offer from 4% to 3%. If you’re looking to make both purchases and balance transfers, we recommend the flagship Discover More Card.  It has a 0% APR on balance transfers and purchases for 15 months.

The Capital One card gets the bronze this month. It’s the only major company with an above-average balance transfer card. Their Platinum Prestige card currently offers a 0% APR on purchases and balance transfers for approximately 15 months, according to smartbalance.com

The Wall of Shame

Bank of America, Wells Fargo and U.S. Bank are on our Wall of Shame this month. If you currently use any of these banks for balance transfers, you may be getting ripped off.

Bank of America has a 0% introductory rate for balance transfers on just one of its credit cards. The promotion features a 4% balance transfer fee and lasts either 9 or 12 months, based on an individual’s application. Wells Fargo should also be scolded. Of the three balance transfer credit cards they promote, each promotional rate lasts for a short six-month introductory period, while Citi and Discover are nearly a year in duration. U.S. Bank is even more horrible, charging nonsensical 4% transfer fees.

What’s Next?

Enjoy balance transfer rate now; it’s unlikely that they’ll get better than they are these days. A continued downward spiral for the economy could lead banks to change these offers, and lead to less flattering options. Expert advice? Go and get ‘em.

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Posted June 26, 2011 by ilanamelissagreene in Uncategorized

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