balance transfer feeUpdated: May 2, 2019

We’ve detailed the benefits of balance transfer credit cards time and time again because these cards can truly be lifesaving when you need to save money or pay off debt. That’s because these cards offer long 0% intro APRs, allowing you to transfer your credit card balance so you can avoid interest for an extended period of time as you pay down or off the balance. That said, many credit cards come with balance transfer fees, which could make you wonder if these costs outweigh the cards’ benefits. In this post, we’ll be explaining what a balance transfer fee is and digging into whether or not it’s worth getting a card that has one.

What is a balance transfer fee?

When you stumble across the term “balance transfer fee,” it’s natural to wonder what a balance transfer fee is and why there is one. The short answer is it’s a cost that the credit card issuer charges when you complete a balance transfer. These fees usually cost 3% to 5% of the amount transferred and come with a minimum (e.g., $5). If you transfer a balance to a card with a balance transfer fee, the fee will be added to your total balance — you are not asked to pay it up front. For example, if you’re transferring a $4,000 balance to a card with a 3% balance transfer fee, the balance on the new card will be $4,120.

Is it worth paying a balance transfer fee?

We often see reader comments about how they’re deterred from applying for a card because of its balance transfer fee. However, the truth is that a balance transfer fee won’t break the bank and usually makes sense to pay, and as such, shouldn’t deter you from getting a card with a balance transfer fee. That said, not all balance transfer fees are created equal, and you’ll want to make sure your new card’s fee is worth paying before you apply and complete the transfer.

Before you do that, you’ll want to make sure the new card is right for you and your balance transfer. Here’s how: look at the length of the card’s 0% intro APR, and then determine if you would have enough time to pay off your balance. For example, if you’re looking to transfer $4,000 to a card that offers an 18-month 0% intro APR on balance transfers and a 3% balance transfer fee, you’ll want to make sure you’re comfortable with making at least $229 in payments each month, as that’s how much you’ll need to pay to rid yourself of the debt before the APR runs out. After you find the card with the right 0% intro APR length, you’d want to make sure the balance transfer fee is lower than your current credit card interest rate — spoiler: it likely is. As a general rule of thumb, if a particular card provides an intro APR that’s longer than a year and if the balance transfer fee is lower than your current interest rate, then you will save money by getting and using it. Keep in mind that once you decide a card is right for you, you’ll want to recalculate how much you should pay each month to include the balance transfer fee. In our example above, you’ll need to pay at least $229 to pay off a $4,120 balance (the amount due including the balance transfer fee) in 18 months.

Now that you know more about balance transfer fees, visit our balance transfer credit card reviews to find the right card for your needs and apply online.

Disclaimer: This content is not provided or commissioned by the credit card issuer. Opinions expressed here are author’s alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. This content was accurate at the time of this post, but card terms and conditions may change at any time. This site may be compensated through the credit card issuer Affiliate Program.