Playing The Balance Transfer Arbitrage Game

Moving credit card debt from one account to another has long been a practice designed to entice consumers into applying for a new card. With the promise of 0% APR (for 6 to 15 months), who’s going to say no?

If you’re currently using a balance transfer credit card, it won’t take long to realize that you can use this feature to leverage a great offer into even greater benefits for you.

For instance, you can incur a good-sized balance on your prime rewards card, earning you a considerable amount of points. Instead of paying it off in full to avoid nasty charges, you can instead opt to transfer that balance to a 0% APR card and pay it off over the duration of the introductory rate. In effect, you get to settle the balance bit by bit while accruing no charges and enjoying the rewards benefits your purchases has earned you.

Look For 0% APR With The Lowest Transaction Fee

A lot of balance transfer cards offer 0% APR on the first 12 months so there’s no reason to settle for any credit card that won’t give you that long. Advanta even has a series of balance transfer accounts that give you a full 15 months of zero interest balance transfers.

The caveat, for most credit cards right now, are the fees. Most of the 0% APR cards charge a 3% fee on balance transfers with caps between $75 to $100. Since it’s almost next to impossible to find a 0% 12-month minimum card with no fees, just try to find the ones that are willing to charge you the lowest to help you maximize any gains you can make from arbitraging.