Are we in Post-Peak Balance Transfer?

The length of interest-free balance transfers is falling. In September, the longest interest free period for Balance Transfer Offer was 43 months. At the time of writing this article, the maximum you can get is 39 months. That’s if you are accepted by the lender.

How to find the best offer

You can check your eligibility against all the Balance Transfer cards on our site and find out your personal longest 0% offer. But that’s not always the full story. Some lenders might offer you a shorter than advertised 0% introductory period, based on your credit score. Lenders who are known to do this include Barclaycard, MBNA, Lloyds and Halifax, but there are others who guarantee the offer as advised should you get accepted, such as Virgin Money and Sainsbury’s Bank. Once you get a sense of the longest balance transfer you are likely to get, the next step is to find out the cheapest offer, given that you can repay your debt within the offer period. With a little bit of compromise on the length of 0% offer, there are quite a few products that offer both 0% transfer fee and 0% interest for up to 28 months.

What options are there beyond 0%?

You will have to pay a standard APR of 15–35% after your 0% Balance Transfer offer ends. If you don’t want to switch cards every time the 0% offer runs out, or there isn’t a 0% BT offer that suits your personal situation, you could try to reduce your cost of credit by transferring your balance to a low APR card. Lenders such as Lloyds and Tesco offer low APR card with representative APR as low as 5.7%, and charge no balance transfer fee.

Representative rates

However, lenders could charge a different interest rate based on the customer’s credit scores. The advertised APR is only a “Representative APR”, which is the APR at least 51% of customers get. The remaining will get a higher APR. If you have a very good credit score, you have a higher chance of getting the low rate. Unfortunately, you won’t be able to find out for sure which rate you will get until you apply for the card. At TotallyMoney we are able to show you the actual rate on a number of products and are actively encouraging partnering lenders to adopt this practice as it's provides a better service for our customers.

Consolidation with cards

Another alternative is to apply for a personal loan to pay off your debt. If your debt is between £7,500 to £15,000, you might be eligible for a personal loan with representative APR as low as 2.9%. Again, this rate is not guaranteed if you are not pre-approved for the offer. However, a few lenders such as Zopa and Ratesetter allow you to get your personalised rates within a few minutes on their website before you apply and will not impact your credit score. Information correct at time of publishing so could be subject to change.