Many people are looking for better low-interest balance transfer card deals from various financial institutions to pay off their credit card debt as having a lower interest rate card enable them to save substantial amount of money for paying bills, loans and other expenditure.

For instance, Lisa who owed $15,000 on a 16% card with a 2% minimum payment (which is $300) – if she managed to pay only the minimal amount, it would take around 44 years to pay off her debt as the total cost would be up to $43,992

Then, she decided to transfer her balance from her old card account to the new one which offered her a lower-rate card with 12% of interest, and send in the same amount to pay off her balance. It would take around 30 years to get rid her debt for good – that saved her $14,447.

Paying a bit extra on the minimal payment able to hasten the paying off process – for example, if Lisa consistently sends in $400 a month, she’ll be able to save $25,098 and able to achieve debt-free status at the end of four years.

It might sound like a fairy-tale story when people using balance transfers to pay off credit card debt. It can turn it into a “nightmare” if someone neglect of the following:

1. Don’t close your old credit card accounts

Once you’ve transferred the balance from your old card account to the new one, keep the old card because closing your old account can affect your credit score. In fact, closing your account can actually cause more damage on your credit score than opening up a new credit card account. It is because closing your account will lower both the average age of your accounts (15% of your credit score), and your debt to credit ratio (30% of your credit score).

Besides that, it is preferred that you don’t charge any money on anything until you get your total balance down fewer than 30% of your available credit. If it’s possible, don’t spend on your balance transfer card in order to stay focus on getting rid of your debt.

2. The standard (Annual Purchase Rate) APR rate are given based on your credit history

Don’t think that all banks are providing the same regular APR for all credit card holders. In fact, actual APR imposed is based on applicant’s credit history. Apparently, a person has to pay more in interest than anyone else because of his low credit score. Thus, you have to make comparison of all the credit cards available so that you can find a card which has the lowest standard APR.

3. Never spend on a balance transfer card

Remember that your main aim of having balance transfers is to pay off your credit card debt – therefore spending your balance transfer card actually beat the purpose. Since your old and unused card has no balance, you can still use it – but this time, spend it wisely like you’re using real cold cash. In short, one card is meant for spending as the other one is meant for paying off debt. Make use of the time (6-12 months) and zero interest to pay them off and save most of your hard-earned money.

4. Always read the fine print (by using a magnifying glass – if required)

This is the part that you cannot ignore – you have to be alert of any fees involved including balance transfer fee (which banks normally charge 3-10% of the total amount transferred). There are other things that you must aware:

• The standard APR after the introductory period – what the rate will be after the introductory period.
• The duration of the introductory rate – how long you can actually make use of the introductory rate (it can be zero percent).
• Don’t use a card if it has higher rate for new purchases.
• No matter which card you’re using – It always have high default APR – so, don’t make any late payments.