7 Times It’s Smart To Use Balance Transfer Checks

You are going to hear again and again that it is a bad idea to use balance transfer checks when they are offered to you by your credit card company. For the most part, this is good advice. These checks can come with high fees and can cause you to spend more money than you should on your credit card. However, there are times when it does make sense to use balance transfer checks because the benefits of using them outweigh the drawbacks. You should be aware of these times so that you can make wise use of balance transfer checks when they are offered.

Here are seven times when it’s actually smart to use balance transfer checks:

1. When you can pay off the balance during the low-percentage offer. Balance transfer checks usually have a low APR for either 6 or 12 months. If you want to consolidate debt and pay off the entire amount before that time period is up, using the checks could be a great way to do that.

2. When there is no transaction fee. Every once in awhile you’ll get balance transfer checks where the fee to use them has been waived. If the interest rate is low, this is a smart time to use them.

3. When you would otherwise have to make a late payment on another card. Balance transfer checks can be used to pay off other credit cards. If you have no other way of making a minimum payment, this is typically better than getting late fees on those cards.

4. When you’ll have lump sum money coming in soon. Students sometimes use balance transfer checks to hold them over until their school funds come in. If you’re in a bind and the checks come with low interest and low transaction fees, this can be a smart thing to do but only if you really do pay the bill when you get your money.

5. When disorganization with credit cards is getting you into trouble. If having to pay too many bills is causing late fees and over-limit fees then you might want to use balance transfer checks to consolidate and get back on track.

6. When you want to loan someone money with interest. If a friend needs help paying credit card bills then you can use the balance transfer checks to pay those bills and then charge the friend a higher interest rate to earn some money for your help.

7. When you know what you’re doing. As long as you understand how balance transfer checks work and what the pros and cons of using them are then you should be able to use them without serious damage to your finances or your credit.

It is definitely true that there are drawbacks to making use of those balance transfer checks that come in the mail. However, they aren’t all bad. Know how they work and then use them in a smart way to make them work for you instead of against you.