What happens when you transfer a balance
A balance transfer moves debt from one credit card to another, usually one offering a lower interest rate for a set period. You request the transfer through the new card's issuer, who pays off your old card's balance directly. The debt then sits on the new card, where you owe it instead of the original lender.
The new card charges you a balance transfer fee — typically 3 to 5 percent of the amount moved — added to what you owe. After the promotional period ends (often 6 to 21 months), the regular interest rate kicks in. During the promotional window, you pay little or no interest, which is the main reason people do this.
The goal is to pay down the balance while interest is low or absent. If you don't pay it off before the rate jumps, you'll owe interest on whatever remains, sometimes at a higher rate than your original card charged.
Key Takeaways
- Balance transfers move your debt to a new card with a lower promotional rate, but you pay a one-time fee of 3 to 5 percent upfront.
- The promotional period typically lasts 6 to 21 months, after which the regular interest rate applies to any remaining balance.
- You must request the transfer through the new card's issuer, who contacts your old card company to pay the balance directly.
- Your credit score may dip temporarily when you open the new card and when the transfer posts, but usually recovers within a few months.
- Transferring a balance does not close your old card, but carrying a zero balance on it can help your credit score over time.
Check your current card's terms before you move
Before requesting a transfer, look at your existing card's interest rate, any promotional rates you're already using, and your current balance. If you're already in a 0% promotional period on your current card, moving the balance might not save you money once you factor in the transfer fee.
Also check whether your current card charges a fee for paying off the balance early. Most don't, but some older cards or store cards do. If yours does, that's another reason to move the balance — you'll avoid that penalty when the old card is paid off.
Write down your current balance, your current interest rate, and the date your promotional period ends (if you have one). You'll need this information to compare whether a transfer actually saves you money.
Find a card with a promotional rate that fits your timeline
Balance transfer cards advertise their promotional period length and fee percentage. A card offering 0% for 18 months with a 3% fee is different from one offering 0% for 12 months with a 5% fee — the math changes depending on how much you can pay down each month.
If you can pay off the balance in 12 months, a shorter promotional period is fine. If you need 18 or 20 months, you need a card that gives you that window. The longer the promotional period, the more time you have to pay without interest, but these cards are often harder to get approved for if your credit score is lower.
Check the card's regular interest rate too — the one that applies after the promotional period ends. If you don't pay off the balance in time, you want to know what you'll owe interest on.
Request the transfer through the new card's issuer
Once you're approved for the new card, log into your account or call the card issuer's customer service number. Look for an option called "Request a Balance Transfer" or "Transfer a Balance." You'll need your old card number and the balance you want to move.
The new card's issuer will contact your old card company and arrange payment directly. You don't send money yourself. The transfer usually takes 5 to 14 business days to post, though some issuers complete it faster.
During this time, keep making minimum payments on your old card if you haven't received confirmation that the transfer posted. Once the transfer completes, your old card's balance drops to zero (or to whatever portion you didn't transfer), and the new card shows the transferred amount.
Understand the fee and do the math
The balance transfer fee is calculated on the amount you move, not on your total credit limit. If you transfer $5,000 with a 3% fee, you pay $150 upfront — added to the $5,000, so you now owe $5,150 on the new card.
To know if the transfer saves money, compare what you'd pay in interest on your old card versus what you'll pay in the transfer fee plus any interest after the promotional period ends. Use a calculator or do it by hand: multiply your current balance by your current interest rate, divide by 12 to get the monthly interest, then multiply by the number of months until you can pay it off. Compare that to the transfer fee alone.
Example: You owe $3,000 at 18% interest. In 12 months without a transfer, you'd pay roughly $270 in interest if you made no payments. A balance transfer with a 3% fee costs $90 upfront. If you can pay $250 a month on the new card, you'll pay off the balance in about 13 months with minimal interest — saving you money despite the fee.
Pay down the balance during the promotional period
The promotional rate is only useful if you actually reduce what you owe. Set up automatic payments from your bank account to the new card — at least enough to cover interest plus a chunk of principal. If the promotional rate is 0%, every dollar you pay goes toward the balance instead of interest.
Calculate how much you need to pay each month to clear the balance before the promotional period ends. If you're transferring $5,000 and have 18 months, you need to pay roughly $278 a month to finish on time (not counting the fee). Build in a buffer — aim to pay it off a month or two early so you're not caught by a late posting or a miscalculation.
Don't use the new card for new purchases during the transfer period. Most cards explore payments to the lowest-interest debt first, so new purchases at regular rates will sit while you pay down the transferred balance. This slows your progress and costs more in interest.
Watch what happens to your credit score
Opening a new card triggers a hard inquiry on your credit report, which can lower your score by a few points temporarily. When the balance transfer posts, your credit utilization changes — you now owe money on two cards instead of one, which may lower your score further.
However, as you pay down the new card's balance, your utilization drops and your score typically recovers. Keeping your old card open (even with a zero balance) helps your score because it preserves your total available credit and shows a longer credit history. Closing the old card would reduce your available credit and could hurt your score more.
The score dip is usually temporary. Most people see their score recover within 3 to 6 months if they make on-time payments and reduce the balance.
Frequently Asked Questions
Can I transfer a balance if I have bad credit?
Most balance transfer cards require a credit score of 670 or higher, though some issuers go lower. If your score is below 650, you may not be approved. In that case, look for a personal loan or a card with a lower credit requirement — you'll pay more interest, but it's still an option.
What if I can't pay off the balance before the promotional period ends?
Any remaining balance will be charged the regular interest rate, which is often higher than your original card's rate. You can request another balance transfer to a different card, but you'll pay another transfer fee. It's better to adjust your payment plan now so you finish before the promotional period expires.
Does transferring a balance close my old card?
No. The old card stays open with a zero balance. You can leave it open to help your credit score, or contact the issuer to close it if you prefer. Closing it will reduce your available credit and may lower your score slightly, so most people leave it open.
Can I transfer a balance between cards from the same bank?
Most banks do not allow you to transfer a balance from one of their cards to another of their cards. You'll need to use a card from a different issuer. Check the card's terms or call customer service to confirm before you explore.
How long does a balance transfer take?
Most transfers post within 5 to 14 business days after you request them. Some issuers are faster — a few complete transfers in 2 to 3 days. Check your new card's website or call customer service for an estimate. Until the transfer posts, keep paying your old card to avoid late fees.