Balance Transfer Credit Cards for Fair or Average Credit

A new credit card with a low introductory APR on balance transfers can be a great option to help you pay down debt and improve your credit score. This type of card lets you move high-interest debt to a new card with a lower rate, potentially saving you money on interest and helping you pay off debt faster. Keep in mind that eligibility criteria vary, and if you have fair or average credit, you might encounter fewer options compared to those with good or excellent credit.

Let’s explore the likelihood of getting approved for a balance transfer card with a fair or average credit score and how you can use a balance transfer offer to improve your creditworthiness.

What is fair credit?

"Fair credit" refers to a specific range of scores within a credit score model. Credit scores help credit card issuers decide whether to approve a credit card application and determine certain terms on the card if approved, such as the credit limit and interest rates that apply to certain transactions like purchases and balance transfers after any low introductory APR offers expires.

While different issuers may use different credit score models to calculate your credit score, common factors that typically contribute to your score include your payment history, credit mix, credit history and credit utilization.

What is average credit?

“Average credit” is a term that may be used to describe a credit score that falls within the fair range. If your credit score is in this range, it may indicate a mixed credit history, such as occasional late payments or high credit utilization. While not considered poor, average credit may still limit your access to the most competitive balance transfer offers.

That said, having average credit doesn’t guarantee you won’t qualify for a new credit card with a balance transfer offer. Additionally, it may mean you need to look for specific options. Taking steps to improve your credit score before applying can help increase your approval odds and potentially access better terms.

Finding a balance transfer credit card with fair or average credit

Even if you have fair or average credit, finding a balance transfer card that works for you is still possible. While the range of offers might be smaller, there are cards designed specifically for people in your credit range. It's worth exploring the available options and comparing terms to discover a card that can help you manage and consolidate your debt.

How to manage balance transfers to improve your credit score

If you are approved for a new balance transfer card with a low introductory APR offer, now is the time to make the most of it. Concentrate on paying down as much of your transferred debt as possible before the introductory period ends. This strategy will not only help boost your credit score but also save you money by avoiding the higher interest rates that kick in afterward.

While meeting your monthly minimum payment on time is important to avoid penalties, putting more than the minimum towards every credit card payment can help build your credit. You should also avoid making new purchases on the balance transfer credit card since you may be charged interest on those purchases unless you pay off the statement balance, including the entire balance transfer amount, by the payment due date each month. Check the terms of your credit card agreement to know how best to use your card.

Balance transfer credit cards also typically charge a balance transfer fee, which will often either be a percentage of your transferred amount or a flat fee, whichever is greater.

Improving credit with a balance transfer

Potential applicants with fair or average credit may also want to consider using a balance transfer card to help pay off debt and help build credit.

Credit cards with low introductory APR offers on balance transfers can temporarily help prevent your debt from accumulating high interest charges. This means that your credit card debt may be easier to manage and pay off, which may, over time, lead to an improved credit score. Remember, though, that the low introductory APR on these cards lasts for a limited time and may not apply if you miss payments. If this happens, you may find it more difficult to improve your credit.

If you use a balance transfer offer on a new credit card to pay off another credit card entirely, keeping the old account open may be a better option than closing it. If you don’t increase the spending on all your credit cards, keeping the old account open could help decrease your credit utilization since you will have more available credit. Keeping the account open also increases your average credit account age. Both factors can help improve your credit score over time. Be aware, however, that if there is an annual fee on the card, it will continue to be charged as long as the account remains open.

If you pay more than the minimum amount due by the payment due date each month on your credit card accounts, keep each of these accounts open while decreasing spending across the accounts to lower your credit utilization ratio, and pay off existing balances with the help of a balance transfer offer, these actions may help improve your credit.

Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional.

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