How To Transfer A Credit Card Balance

Before you transfer a credit card balance, make sure you and your debt are eligible. 

• Ensure the new issuer allows transfers from your existing card’s bank. In general, you can’t transfer debt from within the same parent bank. Read more about credit card exclusion below. 
• Check that the transfer limit on the new card is enough to move all of your debt. For example, if the transfer limit is 80% of your available credit (and you want to transfer $5,000 of debt), you’d need $6,250 of credit on your new card to complete the transfer. Keep in mind that a transfer fee may apply, such as 3% of the transaction. The transfer limit typically includes this fee, so be sure to add it into your calculations. 
• Consider any residential or income requirement for new cards. If you’re transferring a balance to a new card, you need to meet the eligibility requirements like anyone else. Some cards only allow permanent residents with annual incomes above a set amount to apply. 

Most balance transfers can be applied for online. Before you start, get the following documents and information ready in digital format, if applicable:

• identification documents, such as a passport or driver’s licence 
• financial information, such as income, payslips and living expenses 
• account number and details of the card you’re transferring the balance from 
• the ideal credit limit for the new card

• New card: If you’re taking advantage of a balance transfer offer on a new card, you’ll need to apply for the card and complete the section on balance transfers during the application process, providing details about your current card and how much you’re moving over. Once approved, the transfer is made. It can take up to two weeks to process, depending on the bank or issuer.  
• Existing card: If you’re transferring a balance to a credit card you already own, you typically have to complete a balance transfer application from your issuer, which can be done online. You’ll likely need to submit your contact information, as well as the account details for both cards — the card you’re moving the balance from and the card you’re moving it to.

Once you’ve transferred the balance to your new card, remember to cancel the old one. Or, if you’d prefer to keep the account open, remember to pay any balances still left on the card, as well as any annual fees. Also, check there aren’t any recurring charges being made to the card, like a phone bill that could silently rack up debt.

The final step to transferring a balance is to pay it off. This means creating a repayment plan: 

• First, divide the amount you owe by the number of months the promotional interest rate is active. For example, if you transfer $5,000 at 0% for 24 months, with a 3% transfer fee, then divide $5,150 by 24, which equals $215. 
• Next, set up a direct debit of $215 to the credit card every month. This way, you’ll be able to chip away at the debt, interest free, and have it paid off by the time the promotional period ends.