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If you’re struggling with debt, a balance transfer credit card Canada will help you a lot. These cards offer a reprieve by allowing you to transfer balances from other cards to a new one.
Choosing the right card is essential. It’s not just about finding the lowest interest rate, but also about the promotion period, the transfer fee, and the credit limit offered.
However, throughout the process, many wonder: Is it really worth making a balance transfer? If the answer is yes, the next step is to understand how to ensure that you make the most of the promotional period and don’t end up incurring new debt.
We will analyze everything about balance transfer credit card Canada today. Offering a simple step-by-step guide to make the most of a credit card with balance transfer in Canada.
Best Credit Cards with Balance Transfer in Canada
1. MBNA True Line Mastercard (Balance transfer credit card Canada)
The MBNA True Line Mastercard is one of the best options for those looking for a credit card with a balance transfer.
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It offers 0% interest for 12 months, which is a big plus if you’re trying to get rid of accumulated debt.
During this time, you have the chance to pay off your debt without worrying about high interest rates, which can make a good difference at the end of the month.
The transfer fee is 3%, which is common for cards with such low promotional rates.
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Additionally, there is no annual fee, which helps reduce costs over time.
2. CIBC Select Visa
The CIBC Select Visa is an excellent alternative for those looking for a credit card with a balance transfer with a lower transfer fee.
It offers 0% interest for 10 months, which can be enough for those who are trying to pay off debt faster.
The attraction of this card is the transfer rate of only 1%, which is one of the lowest on the market.
However, the CIBC Select Visa has a limit of 50% of the credit limit for transfers, which can be an inconvenience in case you need to transfer a larger balance.
3. Scotiabank Momentum NoFee Visa (Balance transfer credit card Canada)
The Scotiabank Momentum NoFee Visa is one of the best cards if you are looking for a credit card with a balance transfer with no annual fee and cashback.
In addition, it offers 0% interest for 6 months on balance transfers, and a transfer fee is 2%, which is reasonable considering the promotional period and the cashback offered.
In addition, the Scotiabank Momentum NoFee Visa has 1% cashback on categories such as fuel, groceries, pharmacies and recurring payments, and 0.5% on other purchases.
4. BMO Preferred Rate Mastercard
The BMO Preferred Rate Mastercard is a good option if you are looking for a credit card with a balance transfer with low promotional interest rates and no minimum income requirement.
It offers 0.99% interest for 9 months on balance transfers and a transfer fee is 2%, which is considered fair for a card with such a low interest rate.
In addition, the BMO Preferred Rate Mastercard does not require a minimum income. But, you will have to pay an annual fee of CAD 29 is exempt in the first year, which can be a relief for those who want to avoid additional costs.
Step by Step to Make the Balance Transfer
Now, we will know the step-by-step guide on how to make an efficient balance transfer:
1. Choose and Apply for the Balance Transfer Card
The first thing you should do is choose the ideal credit card with balance transfer.
Look for one that offers a long promotional period (if possible, 0% interest for 12 months) and with a reasonable transfer rate (usually between 1% and 5%).
2. Analyze the Amount to Transfer (Balance transfer credit card Canada)
When choosing the card, you must calculate how much you want to transfer.
Prioritize higher-interest debts, as they are the ones that impact your finances the most.
Remember that you must respect the credit limit of the new card.
3. Start the Balance Transfer
Once you receive the card, you will need to provide the numbers of the old accounts you want to transfer.
In some cases, you may do this during the application process. While in others you will need to call the card issuer.
4. Draw Up a Payment Plan Within the Promotional Period
Now that the transfer has been made, it’s time to create a payment plan.
To avoid interest after the promotional period ends, calculate how much you’ll need to pay each month to pay off the debt on time.
For example, if you transfer CAD 5,000 and the promotional period is 12 months, you will need to pay at least CAD 417 per month to pay it all off before the interest increases.
5. Avoid New Purchases on the Transferred Card (Balance transfer credit card Canada)
A common mistake is using the new credit card to make purchases during the promotional period.
This negates the benefit of the promotional rate and can add to your debt.
Therefore, we recommend that you focus on settling the transferred debt and avoid adding more expenses.
6. Monitor Your Payments and Financial Situation
To ensure that you don’t miss deadlines and keep your credit score in good shape, it is recommended to set up automatic payments.
Additionally, review your budget regularly to ensure that you are on track to pay off your debt within the promotional period.
And remember, once you’ve paid off the balance, reevaluate your credit habits and consider creating an emergency fund to avoid falling into the same situation in the future.
Conclusion (Balance transfer credit card Canada)
Balance transfer is a strategy for those who want to relieve the pressure of credit card debt by taking advantage of low interest rates or even 0% during the promotional period.
However, it is important to be strategic.
Choosing the right credit card with a fair transfer rate, a proper promotional period, and no surprises like high annuities can make all the difference.
Additionally, having a structured payment plan and avoiding new purchases on the transferred card are crucial steps in ensuring that you pay off your debt efficiently.
Also remember that while transferring a balance offers momentary relief, it requires financial discipline.
There are many options, it is common to be in doubt. Get to know the and don’t have this doubt anymore. Detailed guide to the best credit card in Canada right now, where we explain the step-by-step guide to an assertive choice.