Transferring a balance from a credit card with a high annual percentage rate (APR) to another card with a lower rate could save you money on interest and potentially help you to pay your debt down faster. Having a balance transfer declined, however, could throw a major kink in your plans.

There Are Several Possible Reasons

Just because you request a balance transfer does not mean that you’ll be approved to receive it. There are a number of situations in which a credit card issuer might say no to your balance transfer request. For example, you may have a balance transfer declined if:

  • You have a poor credit history: If you’re applying for a brand-new credit card to take advantage of a promotional balance transfer offer, the credit card company is going to look at your credit report and credit score before approving you for an account. Things like excessive late payments or collection accounts could send up a red flag where your creditworthiness is concerned. (If you’re not creditworthy, you shouldn’t expect creditors to open new accounts and extend credit to you.)
  • You’ve made excessive transfer requests: Frequently shuffling balances among credit cards could also count against you if you’ve applied for several new cards within a relatively short span of time. This could give the credit card companies the impression that you’re desperate for credit or not in control of your finances, which may make them reluctant to approve you for a new account to enable you to transfer a balance.
  • You’re attempting a transfer with an ineligible card: One thing people tend to get wrong about balance transfers is that you can use any card to make one. Generally, you can’t transfer a balance from Card A to Card B if both cards come from the same issuer. You would have to initiate the transfer request with a different credit card company.
  • You don’t have enough available credit to complete the transfer: In some cases, performing the balance transfer is declined is due to a too-small credit line. Checking your available credit beforehand can give you an idea of how much you can reasonably expect to be able to transfer.
  • If your balance transfer request exceeds your credit line: Some creditors will process partial balance transfers up to the credit line. This could mean you could have the balance split between two accounts.

Balance Transfer Declined? What to Do Next

If you’re turned down for a balance transfer, all is not lost. You could simply move on to another credit card company and try again. Bear in mind, however, that if you’ve been denied once, the odds of getting approved could be stacked against you. In fact, the more often you apply, the more damage you may be doing to your credit score because creditors will check your credit report when deciding whether to approve you, which will lead to additional hard inquiries.

What you may want to do instead is to focus on creating a plan for rebounding. Here are four helpful tips to keep in mind if transferring a balance is your goal:

  1. Understand why you were denied: Knowing what led to your application’s being declined will give you a starting point to work from. How you proceed may be very different if the denial was linked to bad credit versus simply using an ineligible card.
  2. Check your credit report and score: If poor credit is the culprit, reviewing your credit report and score is the next step. Look at your credit report for errors or inaccuracies that could be dragging your score down. If you spot something that looks amiss, you can dispute it with the credit bureau that’s reporting it. The credit bureau is required to investigate and either correct or remove the information, which might give your credit score a boost.
  3. Practice good credit habits going forward: How you manage your finances can have a significant impact on the state of your credit. Paying your bills on time, keeping your credit balances low, using different types of credit, and keeping applications for new credit to a minimum can all work in your favor if you’re trying to build your credit. Just remember that it takes time and consistency to see positive results.
  4. Do your research: Once you get your credit on the right track, don’t jump on another balance transfer offer without doing your homework first. Consider what kind of credit is needed to qualify for the card and how much you can transfer at one time. That can help you eliminate cards that may not be a good fit. While you’re at it, review the balance transfer fees and APR terms to make sure you’re getting the best deal possible.

Having a balance transfer declined can be unpleasant, but it’s not the end of the line. Knowing what could lead to a denial — and how to cope — can put you in a better position to get approved for a balance transfer the next time around.

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