1066. Do you have high-interest credit card debt? Host Laura Adams answers a listener’s question about how balance transfers work and compare with personal consolidation loans. You'll learn how both options affect your credit scores and ways to slash thousands in interest while keeping monthly payments manageable.
Key Takeaways
- A 0% APR balance transfer temporarily pauses interest, allowing you to avoid monthly finance charges and save money.
- Balance transfers typically charge a fee, such as 3% to 5% of your balance, which gets added directly to your account.
- Once a balance transfer promotion expires, any remaining balance resets to the account’s standard APR, which could be 24% to 29%+.
- Missing a minimum payment on a balance transfer can void the low or 0% promotional rate and trigger a penalty APR up to 29.99%.
- A personal loan that pays off higher-rate debt costs more in total interest than a balance transfer you pay off before the promotional rate expires, but can have a lower monthly payment.
- You can use a balance transfer and a personal loan to eliminate debt with manageable monthly payments.
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Email: Laura@LauraDAdams.com or leave a voicemail: (302) 364-0308.
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