It’s easy to get wrapped up in the hustle and bustle of holiday spending. So much so, that sometimes you spend more than you planned. However, here at LMCU, we’re hopeful a balance transfer might help! Hear what our lending expert, Joe Batt, has to say on transferring credit card balances after the holidays.

Starting with the basics …

What is a balance transfer?

Batt describes a balance transfer as, “When you are moving debt somewhere else, typically, to another credit card balance. It can even be a balance transfer with an unsecured loan that you have at another financial institution. Really, any debt you have that, if it’s within your new credit card limit, can be moved for a lower interest rate.”

It’s important to understand that a balance transfer can be used on any type of debt. The most common type of transfer is from one credit card to another.

When should you transfer a balance?

The number one rule is to transfer debt from a higher interest rate to a lower one. Lower interest rate credit cards can be hard to find, especially at larger financial institutions.

Fortunately, at LMCU, we have the Prime Platinum card. With rates as low as 6.25% APR*, it’s always a good idea to transfer.

“LMCU’s Prime Platinum card doesn’t have any balance transfer fees, so if you’re getting a new card—great, but if you already have a Prime Platinum card you can balance transfer whenever you want,” Batt points out.

The second reason for a balance transfer is to consolidate your debt. Batt explains, “If you have balances at more than one place it makes payments easier to only pay your balance on one card versus worrying, and potentially forgetting, about multiple bills.”

Remove the hassle of multiple institutions while saving money. With those perks, it’s hard to find a reason to say no—but just for kicks, we’ll try!

When should you not transfer your balance?

It wouldn’t benefit you to do a balance transfer that would result in a higher interest rate than you currently have. When looking at interest rates, watch out for fees in the fine print.

“If that lower rate comes from having a promotional offer, be cognizant of when that rate ends because once it does, the financial institution might charge you interest on the original balance after-the-fact if it’s not been paid in full,” Joe shares, shining a light on offers that might be too good to be true.

Even if 0% APR is offered for a certain amount of time, you may have a percentage of the balance transferred added on as an initial fee. You won’t have to worry about this with LMCU’s Prime Platinum card!

Should I do a balance transfer after holiday spending?

You aren’t alone in making this decision.

“We see the majority of balance transfers after the holidays, or when there is a bigger purchase,” Batt said. “You might use a card that offers rewards/points for large purchases, realize you’ve spent too much money, and balance transfer to LMCU for that lower interest rate.”

Depending on the sum of the debt, it might be hard to get approval for a balance transfer. At LMCU, we have specialists to help you through the process.

If a balance transfer is the right choice for you, take advantage of LMCU’s Prime Platinum card: no hidden fees, a low-interest rate, and still has similar perks offered by the higher interest rate credit cards.

Making the switch could help pay off your debt in a shorter amount of time.

*Rates as of 12/23/21. APR = Annual Percentage Rate. Rates are variable and subject to change after account opening. Lowest rate featured based on credit score of 760. Cash advance fee: 3% of cash advance. International transaction fee: 1% of transaction. Late payment fee up to $25. Subject to credit approval and income qualification. Other rates and terms available, contact us for more information. $5 membership required if not a member.