These Balance Transfer Cards Can Save You Hundreds on Large Purchases
September 13, 2018
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If you’ve recently made a large purchase with a credit card, you may be wondering about your next best steps. Should you continue paying off your large balance on the card you have? Or, should you move the balance to a new credit card with better terms?
At the end of the day, your best course of action depends on factors such as the interest rate you’re paying (your credit card’s APR), how much you borrowed, and how long you need to pay it off. If you made a large purchase you can pay off rather quickly, you may want to stay the course and continue paying down the balance you have. But, if you owe a lot of money and don’t want to pay exorbitant interest charges, you should probably consider other options.
Best Balance Transfer Cards for Large Purchases
Since the average credit card interest rate is now over 17%, it’s not difficult to see how carrying a large balance could hurt you financially in the long run. Paying a high APR on your revolving balance pushes your minimum monthly higher while also ensuring less of your hard-earned dollars go to paying down your debt.
With a new balance transfer card, however, you can secure 0% APR — or zero interest — for up to 15 months or even longer. These offers let you avoid interest while taking the time you need to pay your large purchase off in full.
Capital One® SavorOne℠ Cash Rewards Credit Card
The Capital One® SavorOne℠ Cash Rewards Credit Card is a solid card for a large purchase you haven’t made yet or a balance transfer from another card. That’s because this card offers 0% intro APR on purchases for 15 months; 15.24% - 25.24% variable APR after that, with purchases and balance transfers, and all without an annual fee.
You will need to pay a 3% balance transfer fee to transfer your balance within the first 15 months. However, this card does offer some incentives on regular spending, such as a one-time $150 cash bonus after you spend $500 on purchases within the first 3 months from account opening, as well as ongoing rewards. You’ll earn 3% cash-back on dining and entertainment, 2% back at grocery stores, and 1% on all other purchases, which can add up fast.
Pros: No annual fee, 0% intro APR on purchases for 15 months; 15.24% - 25.24% variable APR after that, signup bonus potential, and ongoing rewards
Cons: 3% balance transfer fee
Best For: Consumers who want 0% APR on purchases or balance transfers with the ability to earn rewards on their spending
Chase Freedom Unlimited®
The Chase Freedom Unlimited® is another solid balance transfer card for large purchases due to the fact you get 0% APR for 15 months. A 5% balance transfer fee does apply, but it may be well worth it to escape high interest credit card bills.
Another important perk this card offers is the ability to earn 1.5% back for each dollar you spend without having to worry about bonus categories or earnings caps. You’ll also receive a $150 signup bonus after you use your card for $500 in purchases within three months of account opening. You can redeem your points for statement credits, gift cards, merchandise, and more. This card also comes without an annual fee.
Pros: Earn a flat 1.5% back, signup bonus potential, and 0% APR for 15 months
Cons: 5% balance transfer fee
Best For: Families who want to earn a flat rate of cash-back and score 0% APR on purchases and balance transfers for 15 months
Wells Fargo Propel American Express® Card
The Wells Fargo Propel American Express® Card is an especially intriguing offer because it offers rewards, a huge signup bonus, and a 0% APR offer all wrapped into one. First and foremost, you’ll get 0% Intro APR for 12 months on purchases and balance transfers (fees apply), then a 14.74%-27.24% variable APR; balance transfers made within 120 days qualify for the intro rate and fee. You will have to pay a 3% fee ($5 minimum) on balance transfers, however.
The rewards proposition on this card is also strong, making it an ideal card to use for a large purchase to begin with. First, you’ll earn 30,000 points worth $300 in cash-back after you use your card for $3,000 in purchases within three months of account opening. Second, you’ll earn 3x points for dining, gas stations, rideshares, transit, and travel including flights, hotels, homestays, and car rentals. You’ll also earn 1x points on all other purchases, and you get all of this without an annual fee.
Pros: Huge signup bonus, excellent ongoing rewards, and 0% Intro APR for 12 months on purchases and balance transfers (fees apply), then a 14.74%-27.24% variable APR; balance transfers made within 120 days qualify for the intro rate and fee
Introductory fee of either $5 or 3% of the amount of each balance transfer, whichever is greater, for 120 days from account opening. After that, up to 5% for each balance transfer, with a minimum of $5.
Best For: Perfect for someone preparing to make a large purchase they need time to pay off
Last but not least, also make sure to consider the Chase Slate®. This card offers no balance transfer fees on transferred balances within the first 60 days, 0% APR on purchases and balance transfers for 15 months, and no annual fee.
You won’t receive any rewards, but you do get a free FICO score on your monthly statement each month. The Chase Slate® is perfect for anyone who needs to make a large purchase but needs a while to pay it off without interest.
Pros: 0% APR for 15 months on purchases and balance transfers plus no balance transfer fees for 60 days
Cons: You can’t transfer balances to this card from other Chase credit card accounts, and this card doesn’t come with rewards
Best For: Anyone who needs to transfer a large balance but doesn’t want to pay a balance transfer fee
The Bottom Line
If you’ve used a credit card to make a large purchase but worry how much interest you’ll pay over time, a balance transfer card with 0% APR might be exactly what you need. Conversely, a card that offers 0% on purchases can be a great tool if you need to make a large purchase and pay it off over time without interest.
The cards on the list are a great place to start, but make sure to check out other balance transfer offers that can help you avoid interest payments when you make a large purchase. With a little research, you should wind up with the right card that will help you save money over time.