I’m in the same boat as you – paying off over $13,000 of consumer debt. In less than two months, however, I’ve paid off over $2200, so it’s keeping me motivated. My remaining $11,000+ debt is spread over 10 credit cards With APRs ranging from 9.99% to 29.99% – Obviously I’m snowballing payments on my highest interest rate currently.

I am now paying all of my bills on time (I was never habitually late, just a couple of times when I lost track of things, but I know it hurt my credit score) and I have just started to pay a few dollars above the minimum, as well as decreasing my overall debt to credit ration. In doing so, I hope that I can eventually get a 0% transfer offer. I have been able to get 4 of my interest rates lowered in the past 2 months, but it’s sad to know that a 9.99% APR makes me happy!

I hope to be debt free by next summer. Good luck with your journey as well!

If you care to follow mine, please visit my new blog: http://payingforplaying.blogspot.com/

While some balance transfer fees are 3%, that’s a 3% FEE, not an ongoing, monthly interest charge.

I just did a quick online search for cheap balance transfers, and found at least two major credit cards (Chase and Citibank) with 0% APR (9 and 12 month terms), and a 3.9% (Discover, until 2010).

So, for example, if one took the Chase 9-month 0% APR, with a 3%/$50 transfer fee cap, that is a very, very good deal. And that does not equal 3% APR paid for the entire term. Rather, that equals $50 for transfer (assuming someone is transferring enough to reach that cap), plus absolutely nothing in interest. So, $50 for 9 months on a large balance is quite a deal.

Steve Herman

1. that you may get a charge of $90 or so to make the transfer. However, while I was originally put out at that fee, I realized it was less than what I was paying in interest each month on my 15.64% credit card, so I realized it was actually quite a good investment. Now, my monthly interest is under $10/month.

2. transfer your balance to a card WITHOUT ANY BALANCE. This is v important, as payments only go to the lowest interest balance first. So, if you have $1000 at 9.9%, and $25000 at 1%, the $1000 balance will continually earn and compound interest until the 25k balance is paid off in full. This is sneaky, and they won’t necessarily tell you this upfront, so be aware.

3. depending on how your credit rating is, you may not want to apply for a new card and get that ping on your credit report. Instead, do as I did and just play the cards off against each other. I have two cards, and when the 1% runs out, I’m transferring to the other, which “always” has a 5.9% or lower balance transfer rate.

Otherwise, taken an hour or two to talk to your credit card companies, or do some research online, is very, very beneficial. If you want to “earn” more money, pay the minimum on your credit card (with the super-low APY), save the money you would have used for the credit card (and earn ~5% in an internet savings account), then use that money plus the interest to put on the credit card when the introductory rate on the balance transfer ends. If you have a savings account/401k/IRA/investment of whatever, and you can earn more on that than you pay in interest on the card, then it’s smart to pay less on your debt so that you can earn more on whatever investment you have.

Great work so far… Go for the 0% Though I generally hate seeing someone pay debt with debt, saving 9% on that much could be a significant chunk of change.

A.J.
http://www.thenewself.com