Are you struggling to pay off credit card debt? If so, additional interest charges are being added to your balance each day. But what if there were a way to take a break from interest charges so you could pay off your balance faster? Credit cards that offer 0% APR promotional financing on balance transfers allow cardholders to do just this. Learn about how to get the most benefit from your balance transfer with these tips.

Balance Transfer

Pay off debt faster with a balance transfer.

How balance transfer offers work

When you open a new credit card account that offers interest-free promotional financing, you are able to transfer existing balances from other card issuers to your new account that will not incur any interest charges on the transferred balance for the duration of the promotional financing period. By law, interest-free promotional financing must last for at least six months1, and some offers extend for as long as 18 months.

Additionally, nearly all zero percent APR balance transfer offers require the payment of a balance transfer fee, which is typically three percent of the amount transferred.

Making the most of 0% interest

Balance transfer offers can help you get out of debt sooner, while paying less interest, but you will have to choose the right offer and use it properly to get the most benefit.

  • First, you need to compare the terms of different offers available. For example, introductory periods for balance transfer offers can range, so you may find offers of six months or more than 12 months. Be sure to shop around for the offer that will suit you best. You can even calculate your potential savings with a balance transfer calculator to give yourself an idea of the benefits.
  • Next, cardholders should transfer their existing balance as soon as possible after their account is opened. Since credit card interest charges are incurred based on the cardholder’s average daily balance, the sooner the transfer is completed, the more interest costs will be saved. However, since balance transfers can take up to two weeks, it’s also important that cardholders continue to pay their other creditors until they receive confirmation that the transfer is complete.
  • Another thing to consider is how payments will be applied to cardholders’ accounts. The Discover card will generally apply amounts up to the minimum payment due first to the balances with the lowest APR, which will always include any promotional financing balance with a 0% APR. Payments in excess of the minimum payment due will then be applied to the balance with the highest APR.

For example:

If you had the offer for the Discover it® card with six months of promotional financing on new purchases, and 18 months on balance transfers, after six months any payments above the minimum will apply to the new purchases balance which will be incurring interest at the standard rate. Therefore, cardholders need to know that their payments will apply to their balance transfer only after new purchases have been paid off. Note that if you make purchases with the card, you will pay interest on purchases unless you have an introductory 0% APR for purchases.  

Balance Transfer


Pay Off Debt Faster with a Balance Transfer.

Balance transfer “don’ts”

Most importantly, an interest-free balance transfer offer should never be seen as a reason to postpone debt repayment. Credit card users who are fortunate enough to receive these offers should seize the opportunity to pay off as much of their debt as possible before the promotional financing period expires. When used in combination with a responsible budget that minimizes expenses and increases payments, interest-free balance transfer offers can be extremely helpful. Cardholders who fail to pay down their debt during the promotional financing period have missed a valuable opportunity. (And under no circumstances should cardholders assume that they will be able to transfer their debts to a new balance transfer offer once their existing offer expires.)

When credit card users understand how promotional financing offers work, they can take the steps necessary to get the most value from them.


Legal Disclaimer: This site is for educational purposes and is not a substitute for professional advice. The material on this site is not intended to provide legal, investment, or financial advice and does not indicate the availability of any Discover product or service. It does not guarantee that Discover offers or endorses a product or service. For specific advice about your unique circumstances, you may wish to consult a qualified professional.