You should do a 0% APR balance transfer if you know that you can pay the balance off.
For most cards, the 0% APR period is only reserved for balance transfers which are made within the first 60 days to 90 days, although the actual time limit can vary depending on the balance transfer card.
After the 0% APR time period of the balance transfer card has passed, any balance transfers will incur some expensive interest at the card's normal APR rate unless the balance is paid off in full.
If you can pay off the balance transfer in full before the 0% APR time is up then it can be a very good idea or if the interest on the balance transfer card is lower than the interest you were paying on the other cards or balance then it can still be worth it.
Balance transfers can have both short term negative impacts on your credit score and long term positive impacts on your credit score.
When you open a new credit card for the balance transfer it triggers a hard inquiry, which lowers your credit score a small amount but only temporarily.
Although when you transfer the balance or debt to the new card, it can also decrease your credit utilization ratio, and paying the balance down can improve your credit score over time.
Once you consolidate your debt into one card, you can then focus on making one monthly payment and paying down the debt faster.
A balance transfer can also sometimes be denied for several reasons.
Some reasons why a balance transfer can be denied are requesting to transfer too much money, attempting to transfer a balance from a card that is issued by the same lender or having a low credit score.
You may also be denied a balance transfer if you're trying to transfer a balance to a new balance transfer card and your application for the new balance transfer card is denied.
If you do get denied a balance transfer you can contact the credit card issuer to find the specific reason for the balance transfer being denied.
0% balance transfers can also be used for paying off certain types of loans like personal loans, student loans and auto loans, by transferring the debt of the loans to a new credit card.
Using the 0% balance transfer to pay off a loan can save you money on the interest.
Although you must also have a plan to be able to pay off the entire loan balance after the balance transfer before the introductory 0% APR period is over, or you can face higher interest rates on the balance that is remaining.
Although you have to find out if your card accepts loan or balance transfers as not all balance transfer cards allow you to transfer loan debt.
Also check the card issuer's policies to confirm they permit transfers of your certain loan type, like persona, auto or student loans.
You should also determine if the possible savings on interest are worth the balance transfer fee which is often 3% to 5% of the amount transferred.
The balance transfer can often be done online or by phone and by providing your new card company with the loan details.