The Best Credit Cards for Consolidating Debt

A balance transfer is a process that allows you to move debt from one high-interest credit card to another lower interest card. With a balance transfer, you could potentially save money on interest rates and make real progress against debt, even if you had trouble getting traction before.

With a balance transfer, cardholders pay off one card by transferring the balance to another, lower-interest alternative. The second credit card company essentially takes over payments on the higher-interest card. Most major banks and financial institutions won’t allow you to transfer balances between two cards they offer.

While you’ll still owe the original amount of charges, you can reduce the amount of interest you’ll owe if you continue to carry a balance. If you can’t pay off the card in full, a balance transfer can help you get on top of your debt and preserve your peace of mind.

Balance transfers may take up to three weeks to process, so keep making payments on the original card in the meantime.

Some credit card companies offer low interest rates — as little as 0% APR — as an incentive to open a new card. Often these rates increase back to the standard higher APR after several months to a year, after the promotional period expires.

Look for a card with a low APR period that will last long enough for you to pay off the balance. If the interest rates increase and you’re still stuck with a lingering balance, it might not be the right time to transfer — you’ll be back in your original situation.

Balance transfers usually come with a fee, around 3-5% of the total balance, which becomes part of the total amount you have to pay off on a new card. When the average American owes $6,354 in revolving credit card debt, that fee adds up to somewhere between $190 and $300.

Despite high balance transfer fees, if you’re paying down a credit card with a high APR, you might still end up saving money on future interest charges. $300 is a significant sum of money, but still more affordable than trying to keep up with the 15-25% APRs that most credit card companies offer as their standard rates.

With the Fiona platform, you can compare credit cards from top providers side by side in one easy-to-navigate display. Fiona can help you find the best offers based on APR and balance transfer fee, so you can make an informed choice about switching to a new provider.

Banks often limit balance transfers to customers with good to excellent credit — in the high 600s or above as a ballpark estimate.

Take a look at the terms and conditions of available offers to see if you might qualify. On the Fiona platform, you can filter results based on your credit score and location, so you only see relevant offers that actually work for your needs. Fiona will quickly survey the landscape and find the right credit card for you.