Balance transfer credit cards offer a powerful tool for Canadians looking to manage and decrease their credit card debt. High-interest rates on credit card debts can quickly escalate the amount owed, making it difficult to pay down the principal balance. Here’s how using balance transfer credit cards can help.
The main benefit of balance transfer credit cards is the potential to significantly reduce the amount of interest paid on outstanding credit card debts. By transferring the balance from a high-interest credit card to a card with a lower interest rate or even a promotional 0% interest rate, Canadians can save substantial amounts of money and potentially repay their debt quicker.
You can usually find out what interest you are paying by reviewing your credit card statement, either paper or online. This information should be clearly listed, often under a section called “Interest Charges”.
While balance transfer cards can be a great tool for managing debt, there are some things to be aware of. Balance transfer fees can sometimes offset the benefits of the lower interest rate, so be sure to factor this into your calculations. Additionally, the low promotional rates typically only apply for a limited time, so it’s essential to have a plan for how to manage the debt once the promotional period ends.
This is an alternative to bankruptcy, allowing you to retain all your assets including your home and vehicles, as well as halting harassing phone calls, wage garnishments, and lawsuits from creditors. Once completed, a consumer proposal will leave you debt-free, having eliminated unsecured debts such as credit cards, bank loans, payday loans, taxes, and personal loans, among others.
A consumer proposal could be an appropriate solution if you are seeking relief from unsecured debts, would like to avoid bankruptcy, and have sufficient cash flow to make regular monthly payments towards what you owe. To see if you qualify for a consumer proposal, click here.
The main benefit of balance transfer credit cards is the potential to significantly reduce the amount of interest paid on outstanding credit card debts. By transferring the balance from a high-interest credit card to a card with a lower interest rate or even a promotional 0% interest rate, Canadians can save substantial amounts of money and potentially repay their debt quicker.
Best Balance Transfer Offers In Canada – July 2023
If you are living in Canada and are currently paying high interest on your credit card, you could potentially save a lot of money by using a balance transfer to one of the following cards (correct as of July 2023):- MBNA True Line Mastercard: This card offers a 0% interest rate for balance transfers for one year. It has a regular interest rate of 12.99% and no annual fee. There is, however, a balance transfer fee of 3%. Additional perks include discounts on car rentals and the option to add up to nine additional users for free.
- CIBC Select Visa Card: This card offers a 0% interest rate for balance transfers for 10 months with a 1% balance transfer fee. The regular interest rate is 13.99%. The annual fee is $29, and it includes other perks such as savings on gas and free international money transfers.
- Scotiabank Value Visa: The card offers a 0% interest rate for balance transfers for 6 months. It has a regular interest rate of 12.99% and an annual fee of $29.
- BMO Preferred Rate Mastercard: This card offers a 0.99% interest rate for balance transfers for 9 months with a balance transfer fee of 2%. The regular interest rate and additional details were not provided in the sources.
- BMO CashBack Mastercard: This card offers a 0.99% interest rate for balance transfers for 9 months with a balance transfer fee of 2%. The regular interest rate and additional details were not provided in the sources.
Cons Of Using Balance Transfers
However, it’s essential to understand the cons as well. High interest rates on credit card debt can quickly accumulate, making it increasingly difficult to keep up with the debt payments. In a typical case, if you carry a balance on a regular credit card, chances are you’re paying around 20% in interest. At such a rate, it becomes difficult to keep up with payments, and the debt can spike—fast.You can usually find out what interest you are paying by reviewing your credit card statement, either paper or online. This information should be clearly listed, often under a section called “Interest Charges”.
While balance transfer cards can be a great tool for managing debt, there are some things to be aware of. Balance transfer fees can sometimes offset the benefits of the lower interest rate, so be sure to factor this into your calculations. Additionally, the low promotional rates typically only apply for a limited time, so it’s essential to have a plan for how to manage the debt once the promotional period ends.
Poor Credit Rating/Rejected For Cards?
If you’ve encountered hurdles due to a bad credit rating or have been declined for credit cards, you may find a viable solution in a consumer proposal. A consumer proposal is a legally binding agreement between you and your creditors that allows you to pay a fraction of your debts, often as little as 30%, via a single manageable monthly payment. This financial tool, facilitated by a federally regulated Licensed Insolvency Trustee, could reduce your total debts by as much as 70%.This is an alternative to bankruptcy, allowing you to retain all your assets including your home and vehicles, as well as halting harassing phone calls, wage garnishments, and lawsuits from creditors. Once completed, a consumer proposal will leave you debt-free, having eliminated unsecured debts such as credit cards, bank loans, payday loans, taxes, and personal loans, among others.
A consumer proposal could be an appropriate solution if you are seeking relief from unsecured debts, would like to avoid bankruptcy, and have sufficient cash flow to make regular monthly payments towards what you owe. To see if you qualify for a consumer proposal, click here.