Business, Legal & Accounting Glossary
A transfer of debt from one credit card to another. The most common reason this is done is to reduce the interest rate being paid.
The credit card market-place is highly competitive. You may well find cards in the market that offer rates that are significantly lower than your existing credit card. Indeed, there are several credit cards available that promote interest-free periods as introductory offers.
Therefore, if you have an outstanding balance on your existing credit card on which you are paying interest, you may find it worthwhile to compare the costs of your current card with those available in the market. If you find a card that makes your debt less expensive to service you may take out the new credit card and arrange for the outstanding balance on your old card to be transferred to it.
Remember, as a rule of thumb, credit cards are an expensive way to borrow. Anything you can do to make your borrowings cheaper puts more of your money back in your pocket.
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This glossary post was last updated: 21st November, 2021 | 0 Views.