What is a balance transfer?

A balance transfer is a process that allows cardholders to move any existing balance from one credit card to another. This often happens when a cardholder is offered a better interest rate, rewards program, or other incentives from a new card issuer. Balance transfers can be a great way to save money on interest payments. In Maryland, balance transfers are regulated by state law. All balance transfers must be disclosed to the cardholder. Balance transfer fees, if any, should also be disclosed. The cardholder must also accept the terms and conditions of the new credit card to complete the transaction. Another important point to note is the cardholder’s interest rate and minimum payment requirements may change after a balance transfer. It’s important to be aware of these changes so that the cardholder is not surprised by a larger-than-expected payment or interest rate. Balance transfers can save a cardholder a lot of money if they are done responsibly. It can be a great tool to help manage credit card debt. However, it is important to remember that any balance transfer should be done with caution and only with proper research and understanding of the terms and conditions of the new credit card.

Related FAQs

What is the Fair Credit Reporting Act?
How do I close a credit card account?
What happens when I miss a credit card payment?
What is a balance transfer fee?
How do I calculate my credit card APR?
What are the different types of fraud protection programs?
What are merchant fees associated with credit cards?
What are the advantages and disadvantages of using a prepaid credit card?
What should I do if I spot an error on my credit report?
What is a Fair Credit Billing Act?

What is a balance transfer?

Related FAQs

Related Blog Posts