What is a balance transfer fee?

A balance transfer fee is a fee that is charged when a credit card balance is moved from one credit card to another. This fee is typically charged as a percentage of the balance being transferred and is paid to the credit card issuer. In New York, the maximum balance transfer fee that can be charged is the lesser of $10 or 5% of the balance transferred. Balance transfer fees are typically only charged if the balance transferred is greater than $100. Balance transfer fees can be beneficial if the new credit card offers a lower interest rate than the existing credit card since this can result in lower overall payments and total interest paid in the long run. Balance transfer fees should be considered in the overall cost of the balance transfer. Banks and credit card companies may also charge balance transfer fees regardless of the size of the balance being transferred. It is important to read all of the terms and conditions of the credit card agreement to understand any balance transfer fees and any other costs associated with transferring the balance. It is also important to understand the total amount of interest that will be paid over the life of the balance transfer to make sure that any balance transfer fees are offset by the savings from a lower interest rate.

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