Will it hurt my credit to transfer from a high interest card to a zero interest card?
I am moving from one active credit card to another. My husband and I both have good credit, but I'm paying about $100 per month in interest. I want to transfer to a 0 interest card.
Probably not. You get points for paying off the old credit line, but then you lose them for having a brand new (read: untested) account. They should roughly offset. It's hard to know specifically how much effect this will have on your credit score, since the credit bureaus use complex algorithms to do the calculation. Then they tweak them from time to time, so you can't know for sure. But it should roughly even out to have no material affect. Good strategy anyway, zapping the interest! To my thinking that would be worth giving up a few points on your credit score.
I am going to assume the goal is eventually pay off the debt at some point. Paying it off will raise you credit score. Any ding you have, if they happen to run your credit to approve the balance transfer offer should be minimal and assuming you aren't buying a car or a home in the next few months shouldn't be an issue at all. Credit scores go up and down a few points each month.
Bottom any potentially small drop in your credit score will be less damaging to your finances than paying $100/month towards interest.
Yours in Success,
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In this specific case of going from one active card to another there will be no negative impact on your credit score! The positive is that by switching the balance to a zero interest card you will be paying down the balance faster so it will be lowering both your overall balance, and your balance to limit ratio at the same time. One thing to note is you may not want to close the card that you are transferring the balance from, as this could negatively impact your score. Part of your score is based on the number of accounts and length of time of your oldest account. If the card you are transferring from is an older card then you may want to leave it open and use it monthly for things like groceries or gas. Just be sure that you don't spend more on it then you can pay off each month so you won't pay any interest.
I hope this helps
It may ding your credit score a little bit in the short run, but I wouldn't focus on a short blip like that. You need to get debt free and a balance transfer is a great way to reduce your interest so that you can pay more of the principal off each month. Your debt to income ratio is much more important when evaluating your credit score. Once you get the debt paid off your score will be better for it. Focus on the longer term goal and don't worry so much about a shorter term event. You can go to sites like www.creditcards.com and compare balance transfer cards. Always read the fine print!