Getting a credit card balance transfer rolls all your credit cards into one. One payment, one interest rate. This can save money if you know how a balance transfer works.

Give me the main points

  • A credit card balance transfer can reduce your interest payments.
  • There may be fees – and also limits to what you transfer.
  • A debt consolidation loan might be a better option for some people.
  • Don’t apply for every card available.

A credit card balance transfer is when you move a debt from one or more cards over to a new card. This card will usually offer a lower introductory (or temporary) rate on the transferred amount.

Reduce your interest payments

Balance transfers may save you money in the short-term. How? Because introductory rates or Special promotions on our credit cards may offer a lower balance transfer interest rate for a Promotional period, compared to interest charges you may be paying on your non NAB credit card accounts, which means you pay less interest.

But what happens once the Promotional period ends. What will the interest rate be? With our credit cards, any outstanding balance transfer amount owing on your account, will revert to the standard cash advance rate. Check with your bank to see what you'll end up paying.

If you think you'll still have an outstanding balance transfer amount on your account, you'll need to do the sums to make sure you're not worse off overall.

Our balance transfer tool can help you here. Enter your existing non-NAB credit card debts (limited to two credit cards) and compare them against the interest on your potential new card. It'll give you an idea how much you’ll save during the balance transfer period.

Factor in fees

Balance transfers may also have an applicable balance transfer fee. Find out if there are balance transfer fees that apply. Once you’ve calculated how much you’ll save, you'll need to take other fees into account (such as annual fees).

What are the conditions?

Balance transfers usually come with Terms and conditions as to what you can transfer, and to where. For example, you may not be able to do a balance transfer within the same bank; and you usually can’t pay out an overseas card.

Also, there’s usually a limit to how much you can transfer. We'll talk about this more in 5 things to consider about balance transfers.

Be selective when choosing a card

Whenever you apply for credit, it'll show up on your credit file. Of course, having records on your file isn’t always a bad thing. But the more credit applications you make, the more it might affect your future borrowing plans.

Don’t apply for everything. Be choosy—apply for the right card. Find out more about applying for a balance transfer.

Consolidate your debt

A balance transfer lets you merge your existing credit card debts into one. But if you have other debts too (like a personal loan), then a debt consolidation loan might be a better option.

Consider how long you think it’ll take for you to pay off your debts. Will it take you a few months? Typically, a credit card will offer a six or 12 month balance transfer rate. But if you think your debt might take years to pay off, then a debt consolidation loan could work better. Personal loans with a structured repayment plan— and loan terms of one to seven years—could be the go.

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