Consumers who are keeping track of costs and rates related to balance transfer credit cards may have noticed that here in the first full week of September there has been little change when it comes to rates available on this particular type of card, as current averages remain between 12% and 16% for cardholders who can qualify for these prime rates. However, this is not to say that balance transfer credit cards are only offering options for debt consolidation through cards branded as balance transfer cards, but there are some men and women who may be looking into applying for one of these cards but are in a position where their current line of credit could offer them the option of transferring balances as well.
Debt consolidation is seen by many consumers as one of the best ways to repay multiple obligations, but it’s at this point that many financial advisers want consumers to take a moment to understand what consolidating debts will entail for their specific situation, as not all agree consolidation is a good technique for debt repayment. Obviously, there are some consumers who have different goals in mind when they seek out either debt consolidation through balance transfer credit cards or from a personal loan, and some are even in a position to pay more than is required on these debt consolidation options, which could get them out of debt much faster and at a lower cost.
When consumers use consolidation options simply as a way to get a lower monthly payment on various debts this often leads to higher overall costs even if an affordable interest rate is available on a credit card or debt consolidation loan. Yet, consumers who have explored these options, and feel that a balance transfer opportunity on their credit card will be right for their situation, have often turned to researching these balance transfer cards, but fail to realize that a variety of different credit cards may offer balance transfer opportunities for current users.
Again, the goal of consumers has often varied when it comes to using these balance transfer cards as of late since some individuals want to open up a new credit card account, consolidate debts from old credit cards or current outstanding debts in other areas, and then close out these accounts but this is where some individuals have also made mistakes particularly when they use balance transfer credit cards as a way to consolidate debt from old credit cards and then close out these accounts.
A credit card that has a longer history can be more helpful when it comes to improving a consumer’s credit score, and of course this is not always a concern for certain cardholders, but financial advisers want consumers to fully understand what balance transfer options, and general debt consolidation, or even closing out credit card accounts after debt consolidation has occurred will mean for their financial life as a whole. While these rates on balance transfer cards may also come with introductory periods where no interest payments will accrue, which can make debt consolidation much more affordable, it is not always in a consumer’s best interest to take this particular route when it comes to debt relief, and again there may even be opportunities for consumers to consolidate their debts on cards they currently have.
However, since this issue of balance transfer credit cards is one that continues to be present in the lives of consumers and has led to inquiries on the part of many cardholders, financial professionals ultimately advise these men and women to take caution when looking at debt relief options in general, to explore any fees or overall costs that may be associated with using a balance transfer to consolidate debts, and consumers must also calculate the total costs that will arise if a balance transfer credit card is used for the purposes of consolidation and debt relief. In the end, it will be a cardholder’s responsibility as to what route they choose to pay off their debts or even how they consolidate debts if they feel this is their best option for handling current debt obligations, but since there are different types of credit cards that may offer a balance transfer opportunity and even debt relief options that do not involve consolidation whatsoever, it’s hoped that if more consumers are seeing easier access to various types of credit cards, caution will be taken when comparing these different offers, the costs that may arise, and the best debt relief option for a consumer’s personal situation.