How does a balance transfer work?

A balance transfer is a method used by credit card holders to transfer their credit card balance from one card to another. It’s a way to consolidate debt, allowing cardholders to pay off their debt with one card and make a single payment instead of multiple payments. In Tennessee, the law states that any balance transfers have to be done in writing with the creditor. The borrower must provide their name, address, and the new account number to which the balance will be transferred. The borrower must also provide the amount of the balance they wish to transfer. The creditor must then process the balance transfer within 30 days. It’s important to note that balance transfers commonly have a fee. The balance transfer fee in Tennessee is typically 3% of the amount being transferred, with a minimum fee of $5. It’s also important to note that balance transfers may have different interest rates than the original card, so borrowers should check the terms of their new card. When transferring a balance, the borrower should make sure that the total balance transfer fee and interest on the new card is lower than if they had paid off the original card. If not, it may be better not to transfer the balance. By following these instructions, borrowers can transfer their balance in Tennessee according to credit card law.

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