There are many 0% balance transfer credit cards available, but before you jump make sure the cards are stacked in your favor. If possible, be sure to get a credit card that offers a low interest or 0% balance transfer provision.

Another often misunderstood procedure to be aware of involves how banks allocate your payments amongst balances that are priced at different rates. If you study the fine print in many offers you will learn that some or all of your future payments are allocated toward the lower interest transferred balances because they are most costly for the credit card issuer to carry. This may not be in your best interest however since you may have run up a separate and higher rate balances on new purchases (which you would want removed first). In this type of scenario none of your higher interest rate balances would get paid down until your transferred balance was gone.

It is also important to realize that not only credit card balances can be transferred. Other types of high interest debts, including installment car and appliance loans, can be moved to a low interest or 0% balance transfer credit card. This is typically handled through credit card convenience or balance transfer checks provided by the issuing credit card bank. It is important to note that some of these checks can carry substantial fees – up to 3% of the amount transferred so be sure to read all the disclosure copy. If this information is not provided at the time of application take it upon yourself to inquire with the credit card issuer to find out since this can be a significant shock if not expected. Even with the fees, however, it is usually a money saving maneuver to transfer balances from a high interest rate loan to a low interest or 0% balance transfer credit card.

Our advice is to study the fine print and decide how you plan to use the card going forward. As referenced in our article “How to Eliminate Credit Card Debt” it is advisable to really control new credit card spending while attempting to pay down an outstanding balance. Once this balance is transferred to a low interest or 0% balance transfer credit card you should have some breathing room to begin chipping away at it until it is gone for good.