Balance Transfers are one of the most potent weapons in a credit card companies arsenal to entice you to sign up to their card. In recent years, with historically low interest rates and fierce competition between credit card companies for your balance transfer many companies now offer balance transfer rates of 0% for up to 9 months. So what exactly is a credit card balance transfer. Quite simply it is transferring an existing balance from one credit card to another. In the process swapping from a high interest rate to a low one. If you have a credit card with an outstanding balance and you are not on the introductory rate then you need to transfer that balance to another card with a low balance transfer rate now! It could literally save you hundreds of pounds a year in interest charges.

There are 2 types of balance transfer offer. Most last for a fixed period of time, say 5 - 9 months after which they revert to the standard interest rate on the card. these are fantastic value as most offer 0% balance transfers for the introductory period. it is important to remember that after the introductory period the rate will be at the higher, standard rate normally around 15% APR. The best idea is to keep switching the balance between different credit card companies and use the special balance transfer rates to pay no interest until you pay off the debt.

However, this does involve considerable commitment on your part to make sure you change the card every 6 months or so, otherwise you will end paying a high rate of interest - exactly what the credit card companies want!

Another option, if you don’t think you can commit to changing cards regularly is to go for a long term balance transfer rate. These don’t last for a few months but apply until the balance is paid off on the card. These are typically around 3-5% APR and will save you money if you feel switching cards is not right for you. You need to be aware however, that any payments you make come off the balance transfer funds first so any spending on the card may be charged at full interest.

See our guide to the best balance transfer credit cards for more details or see the options below.