What happens when you transfer a balance
A balance transfer moves debt from one credit card to another, usually one with a lower interest rate. The new card's issuer pays off what you owe on the old card, and you then owe that amount to the new card instead. The main reason to do this is to reduce the interest you pay while you work down the debt.
Most balance transfer offers come with a promotional period — often 6 to 21 months — during which the interest rate is 0%. After that period ends, a standard interest rate kicks in. You will also pay a balance transfer fee, typically 3% to 5% of the amount you move, charged upfront and added to your new balance.
Balance transfers work best if you have a concrete plan to pay down the debt during the promotional period. If you straightforward move the balance and keep spending, you end up with more debt and a higher total cost.
Key Takeaways
- Balance transfer fees usually run 3% to 5% of the amount transferred and are added to your new balance when ready.
- The promotional 0% interest period typically lasts 6 to 21 months, after which a regular interest rate applies to any remaining balance.
- You must have a plan to pay down the debt during the promotional period, or the transfer will cost you more money overall.
- The new card issuer handles contacting your old card issuer — you do not need to call both companies yourself.
- Your credit score will drop slightly when you open a new card and when the transfer is processed, but it usually recovers within a few months.
Check your current card's interest rate and balance
Before you search for a new card, know exactly what you are paying now. Log into your current card's online account or call the number on the back of your card and ask for your current interest rate (called the APR, or annual percentage rate) and your total balance.
Write down both numbers. You need the balance to calculate whether the transfer fee is worth it — if you owe $2,000 and the fee is 5%, you will pay $100 upfront. You need the interest rate to compare against the promotional rate on the new card.
Also note when your current card's billing cycle ends. This matters because interest accrues daily, and you want to understand how much additional interest will hit your balance before the transfer clears.
Find a card with a 0% promotional rate that fits your timeline
Search for balance transfer cards using a credit card comparison site or by visiting issuer websites directly. Look at three things: the length of the 0% period, the balance transfer fee, and the regular interest rate that applies after the promotional period ends.
A longer promotional period is valuable only if you can realistically pay down the balance during that time. If you owe $5,000 and can pay $300 per month, you need at least 17 months to clear it — so a 12-month 0% offer will not work. A 21-month offer gives you breathing room.
Compare the total cost of transferring to each card. A card with a 5% fee and a 21-month 0% period may cost less overall than a card with a 3% fee and a 12-month period, depending on how fast you can pay.
Open the new card and request the balance transfer
explore for the new card through the issuer's website or by phone. The approval process usually takes a few minutes to a few days. Once you are approved, you will receive a confirmation with your new account number.
Next, request the balance transfer. Most issuers let you do this during the process process itself — you will see a field asking how much you want to transfer and from which card. If you do not see this option during signup, log into your new account online and look for a "Request a Balance Transfer" or "Transfer Balance" button, usually in the Transfers or Payments section.
Enter the amount you want to transfer (you can transfer less than your full balance if you want to keep some debt on the old card, though this is rarely a good idea) and the account number of your old card. The new card issuer will contact your old issuer directly — you do not need to call or write to either company.
Understand the timeline and what to expect
Balance transfers typically take 5 to 14 business days to complete. During this time, you should keep making minimum payments on your old card. If you stop paying and the transfer is delayed, you could face late fees and interest charges.
Once the transfer clears, your old card balance will drop to zero (or to whatever portion you did not transfer). Your new card balance will show the transferred amount plus the balance transfer fee. You will now owe this amount to the new card issuer.
You can close the old card once the balance hits zero, but you do not have to. Closing it will lower your total available credit, which can slightly hurt your credit score. Leaving it open with a zero balance is usually better for your credit profile.
Create a payoff plan before the promotional period ends
The 0% interest rate is temporary. Calculate how much you need to pay each month to clear the balance before the promotional period ends. If you owe $4,000 and have 18 months, you need to pay about $222 per month.
Set up automatic payments from your bank account to the new card for at least this amount each month. Automatic payments reduce the risk that you will miss a due date, which would end the promotional rate when ready and trigger a penalty interest rate (often 25% or higher).
If you cannot pay off the full balance before the promotional period ends, you have a few options: transfer the remaining balance to another 0% card (though you will pay another transfer fee), pay it down as much as possible before the rate resets, or accept that you will pay interest on whatever remains.
Watch for common mistakes
The biggest mistake is continuing to use the old card or the new card for new purchases while you are paying down the transferred balance. New purchases usually carry a regular interest rate when ready — they do not get the 0% promotional rate. This means you end up with two separate balances on the new card, one at 0% and one at the regular rate, and payments go toward the 0% balance first, leaving the new purchases to accrue interest.
Another common error is missing a payment. A single late payment can end the promotional rate on the entire balance, even if you are only a few days late. Set a phone reminder for a few days before the due date, or use automatic payments so you never have to think about it.
Do not assume the transfer is complete just because you opened the new card. Check your old card's balance after 14 days to confirm the transfer went through. If it did not, contact the new card issuer to find out why.
Frequently Asked Questions
Will a balance transfer hurt my credit score?
Yes, but temporarily. Your score will drop when you open the new card (a hard inquiry) and when the transfer is processed (your credit utilization changes). Most people see their score recover within 3 to 6 months as they pay down the balance and the new account ages.
Can I transfer a balance from a store card or a card from a different bank?
Yes. You can transfer from any credit card, store card, or line of credit. The issuer of your new card will handle the transfer regardless of which company issued the old card.
What happens if I do not pay off the balance before the 0% period ends?
The remaining balance will start accruing interest at the card's regular APR. You can continue paying it down at the higher rate, transfer it to another 0% card (paying another transfer fee), or look into a personal loan to pay it off.
Can I do multiple balance transfers to the same card?
Some issuers allow multiple transfers during the promotional period, but each transfer usually resets the clock on the 0% rate or applies a separate promotional period. Check your card's terms before attempting a second transfer.
Should I close my old card after the balance is paid off?
Closing it will lower your available credit and may hurt your score slightly. Leaving it open with a zero balance is better for your credit, as long as the card has no annual fee. If it does charge an annual fee, closing it makes sense once the balance is gone.