Balance Transfer
Lending & MortgagesMoving debt from one credit card to another, usually to take advantage of a lower or 0% introductory APR.
Example
Example: You have $8,000 on a credit card at 22% APR (costing $1,760/year in interest). You transfer to a 0% APR balance transfer card with a 3% fee ($240). If you pay $445/month for 18 months, you pay off the entire balance during the 0% period. Total cost: $240 fee. Without the transfer: $2,640 in interest over the same 18 months. Savings: $2,400.