Credit Card Companies Don't Want Balance Transfer
The first stage of the end of balance transfers began with the elimination of no fee balance transfers and the substantial increases in balance transfer fees. A year ago, the average fee was 3% up to a maximum of $75. Today, many companies are charging as much as 5% and there are no maximum fees. This has, for example, increased the cost of doing a $10,000 balance transfer with some credit card companies from $75 to $500! That’s about a 700% balance transfer fee increase. Now, even with higher fees, balance transfers still offer consumers substantial saving options, especially when 0% interest rates lasted one full year. Unfortunately, most credit card companies have eliminated 0% rates lasting more than 6 months.
Despite increased fees and shortened 0% rate periods,balance transfersare still a great deal for many consumers. Sure, there where hundreds of extra dollars to be saved by getting a card with a 0% APR for a full year. But for many customers whose rates have been raised to the high teens and mid to high twenties, transferring balances still provides many benefits, particularly lower long term interest rates.
The latest move by credit card companies serves to underscore how 0% balance transfers still save consumers money. What is this move? Some credit card companies no longer want to be advertised in balance transfer categories-let alone balance transfer websites such as Smart Balance Transfers. This effectively limits consumer options and removes the idea of balance transfers from consumers who might not know about them.
Simply put, credit card companies do not want your business, especially if you are not generating new charge fees. And despite massive balance transfer fee increases, credit card companies just don’t want to offer consumers a good deal. For the moment, the balance transfer situation is difficult. And, as it has all year long, it could get worse. So, once again, I encourage anyone who could save money with a balance transfer-and that is most people-to get a new balance transfer credit card while issuing banks are still providing these lifelines.
