Balance Transfer

Quick Definition

Moving credit card debt to a card with a lower promotional rate.

Full Explanation

A balance transfer moves debt from one credit card to another, usually to take advantage of a low promotional rate for 6–12 months. Watch for a transfer fee of 1%–3% and the higher rate that applies after the promotion ends.

Related Terms

Credit Card

A revolving credit facility allowing purchases up to a limit, with a standard 19.99% interest rate.

Debt Consolidation

Combining multiple debts into a single loan, typically at a lower interest rate.

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