Canada's Top 10 Balance Transfer Credit Cards. Our Picks for 2024
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Credit cards are an incredibly useful, secure and convenient way to pay for goods and services in Canada and abroad. If you’re not careful though, they can also be a way to overspend and accrue debt.
What happens when your credit card use gets away from you?
Balance transfer credit cards are a great way to reduce your interest payments and help you pay off your current credit card debt. In this article, we will go over the best balance transfer credit cards in Canada and how they can help you get your finances back in order.
What are the best balance transfer credit cards?
Below we have compiled a list of our top 10 low-interest balance transfer credit cards in Canada with balance offers to help you save money, lower your interest rates and even get some rewards in the process. We have included some of the best credit cards for transfer balances and low-interest credit cards.
| Credit card | Annual fee | About |
|---|---|---|
| BMO CashBack Mastercard | $0 |
Get $100 cash back Get 5% cash for the first 3 months Then get 3% back on grocery purchases, 1% cash back on recurring bills and 0.5% cash back on all other purchases Get a 1.99% introductory interest rate on Balance Transfers for 9 months, 1% fee applies to balance amounts transferred $15,000 annual income required 2.5% conversion fee* |
| HSBC +RewardsMastercard | $25 |
Earn up to 40,000 points Earn 35,000 points when you keep your account open and active for an additional 6 months Earn 2 points for every $1 spent on eligible purchases and 1 point for all other purchases 11.9% interest on purchases, cash advances and balance transfers |
| BMO AIR MILES Mastercard | $0 |
Get 1,500 AIR MILES Bonus Miles! Get a 1.99% introductory interest rate on Balance Transfers for 9 months, 1% fee applies to balance amounts transferred Get 3x the Miles for every $25 spent at participating AIR MILES Partners $15,000 annual income required |
| Tangerine Money-Back Credit Card | $0 |
Get up to $150 cash back! Get a 1.95% interest rate on balance transfers for the first 6 months Earn 2% Money-Back rewards in two categories of your choice and 0.50% back on all other purchases $12,000 annual income required |
| Tangerine World Mastercard | $0 |
Get up to $150 cashback. Get a 1.95% interest rate on balance transfers for the first 6 months* Earn 2% Money-Back rewards in two categories of your choice and 0.50% back on all other purchases $60,000 annual income required* |
| BMO Rewards Mastercard | $0 |
Get 15,000 points when you spend $1,000 in the first 3 months Get a 1.99% introductory interest rate on Balance Transfers for 9 months, 1% fee applies to balance amounts transferred $15,000 annual income required |
| MBNA True Line MastercardCredit Card Non-Quebec Residents | $0 |
0% promotional annual interest rate for 12 months on balance transfers completed within 90 days of account opening 2.5% conversion fee* |
| BMO Preferred Rate Mastercard | $20 |
Get a 0.99% introductory interest rate on Balance Transfers for 9 months with a 2% transfer fee and we’ll waive the $20 annual fee for the first year $15,000 annual income required |
| CIBC Select Visa Card | $29 |
Get 0% interest for up to 10 months for a 1% transfer fee, plus a refund of the first year’s annual fee $15,000 annual income required |
| Scotiabank ValueVisa Card | $29 |
0.00% introductory interest rate on Cash Advances for the first 6 months (12.99% after that; the annual fee is $29). Plus no annual fee in the first year. $12,000 annual income required |
What is a balance transfer credit card?
A balance transfer credit card lets you transfer your existing debt from other credit cards and loans to it. This allows you to lower your interest payments and get out of debt more quickly and provides a nice alternative to debt consolidation loans. Interest on these credit cards can be as low as 0% for a limited amount of time but have other fees to take into consideration including a transfer fee.
Good to know
After a promotional period with low interest, rates increase. In many cases, the normal interest rate is still lower than many standard credit cards. This makes it a convenient way to stop your debt from growing while paying off occurred debt.
Compare dozens of Canada's top credit cards now
How do balance transfer credit cards work?
Balance transfer credit cards work by the balance of a credit card to a new balance transfer credit card. Some balance transfer credit cards even accept personal loan balances, so check with the credit card provider to see what is eligible before signing up.
Overspending with credit cards can damage your credit score and cost you hundreds or thousands of dollars in interest. For a disciplined user, these cards are a way to get out of that.
Let’s look at an example:
Keep in mind
Jonathan is a website designer based in Edmonton. He owes $5,000 and has an APR of 20% (right around the average in Canada). If he pays only the minimum and doesn’t use his card to make new purchases, his interest payments come to $82.85 per month. Over ten months, that’s $828.50! He could save big by transferring his balance to a new zero-interest credit card, like the CIBC Select Visa Card. By applying that money towards the total instead of the interest he’s reducing his debt and getting himself back on track financially.
| About | $ |
|---|---|
| Balance | $5,000 |
| Interest saved | $828.50 |
| Transfer fee (1%) | -$50.00 |
| The total amount saved after paying the transfer fee | $778.50 |
How do I do a balance transfer between credit cards?
Moving your balance to your new balance credit card is a relatively easy process but may take time and a little paperwork.
- First, you will need to choose a balance credit card. Compare card costs and services carefully to make sure you get the best card for you. You may have your balance transfer request declined if your existing balance exceeds the approved credit limit on your new card. Have a doubt? Contact the card issuer and provide any information about the balance you are moving.
- Next, go online or call the issuer and make a balance transfer request. Your provider’s website or app should provide a step-by-step walk-through. If you need help call an agent. Filling out banking information incorrectly can cause delays or void the transfer.
- Finally, wait for the transfer to go through! It can take a few weeks for a transfer to be approved and completed. Once completed, you should check both your old and new accounts to make sure everything went through smoothly.
Now that your balance has been transferred you should work to pay off your balance before the introductory interest rate expires. While you may be able to transfer the balance again to keep using introductory rates this will take time, can hurt your credit score and means paying a new transfer fee.
How much do credit card balance transfer fees cost?
Balance transfer fees usually range between 3% and 5% of the total amount being transferred, with a minimum fee of a few dollars.
Keep in mind
Let’s imagine Rebecca, a flight attendant based out of Vancouver. She has $3,500 in credit card debt. If she transfers her credit card balance to a Tangerine Money-Back Credit Card with a 3.00% transfer fee she would owe just $105.00 to enjoy 6 months with a 1.95% interest rate on that debt.
The good news is that balance credit card issuers want your debt! That's why they have credit card transfer balance offers with transfer fees as low as 1%. There are even a few that offer no interest for the first 12 months. Depending on the amount you are transferring and your current interest rate this can save you money even if you only need a few months to pay off the balance.
Watch out!
Pay off your balance as soon as you can. Interest adds up.
Why get a balance transfer credit card?
Balance transfer credit cards are a great tool for reducing interest payments and settling balances:
- You can consolidate multiple credit cards and loan payments into one card. This reduces the number of payments you make each month and the chances of accidentally missing a payment.
- You can save money on interest with lower rates and promotional offers. Rates on credit cards can range from 14% to 24% while balance transfer cards can be as low as 0% on intro deals and even 1.99% for up to a year.
- Many credit cards have high annual fees that you owe until the balance is settled and the card is closed. Moving that balance to a balance transfer credit card can get you out of paying that fee so you can focus on paying off your balance.
Compare dozens of Canada's top credit cards now
What are the disadvantages of a balance transfer credit card?
While balance transfer credit cards can help they still have their drawbacks to consider:
- The biggest cost on a balance transfer credit card will be the transfer fee. Generally, this will be 3% to 5% of the amount transferred. Look for introductory offers on low-balance transfer credit cards to save.
- Keep in mind that the intro offer won't last forever. That 1.99% APR will jump back up to the standard rate after a few months. This can mean a short window for paying off your credit card debt.
- Balance transfer credit card qualifying conditions include minimum credit score and a minimum individual or household income. If you don’t meet these, you won’t be accepted for that card.
Balance transfer credit cards should be used to help manage debt and reduce interest rates. Make sure you aren’t just delaying payments and increasing debt for a later day.
Do balance transfers hurt your credit score?
Simply making a balance transfer won’t negatively affect your credit score. You can make several transfers to a new balance credit card with little to no change to your credit score.
Your credit score will be more affected by what happens after you transfer your balance. If you use the low APR to reduce your debt and make regular payments you will see your credit score improve. If, however, you let your debt continue to build your credit score could suffer.
Keep in mind that opening too many credit cards too quickly can damage your credit score. A single new balance transfer credit card will do more good than bad if you are diligent about using the opportunity to pay off the debt. Churning through credit cards is a red flag for many lenders.
