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WHILE there are still no fee balance transfer credit card deals available, they are now generally limited to ‘low rate for life’ offers as apposed to any 0% rates.
Currently, the balance transfer deals offering waived transfer fees are available on the Barclaycard Platinum Life of Balance credit card and the Co-operative Bank's think credit card.
Both these deals charge no handling fee for transferring a balance over to the card and while not a 0% offer, do offer a promotional lower interest rate either for the life of the balance (until it's repaid in full) or for an introductory period.
To get an up to date view of the credit cards currently available please compare no fee balance transfer credit cards here.
Why are there so few no fee balance transfer deals?
After the launch and boom of the 0% balance transfer the credit card companies found that they were losing too much money on these promotional offers due to cardholders frequently switching products as soon as the 0% period ended.
The 'balance transfer handling fee' was introduced to try and claw back this lost revenue – and it meant they wouldn't lose the incredibly successful 'joining incentive' of offering a 0% deal.
Mainly because all credit card companies introduced this fee it quickly became a norm of a balance transfer offer and cardholders had no choice but to pay it or stay on their current credit card deal.
Research shows that just three years ago there were around fifty cards that offered a no fee balance transfer, but the majority of lenders have started to charge transfer fees, many without any ceiling limit on these fees. You will therefore need to ensure that you do your research and compare the credit card market in order to find the most suitable fee free deal.
However, while the days of fee-free 0% balance transfers are all but over - these no fee deals can still be found on low rate for life balance transfer offers.
Finding a no fee balance transfer credit card
The easiest way to find a no fee balance transfer deal is through a life of balance transfer credit card.
These cards do not offer 0% interest on your transferred balance, but they do offer a very low rate of interest until it is repaid in full – or for a few to several years.
Most life of balance transfer cards do not charge a fee, and if you feel that it will take you a while to clear your transferred balance and you want to avoid paying a transfer fee then this may be the right choice for you.
There are some 0% balance transfer credit cards that do not charge a transfer handling fee, but that these cards are very few and far between.
Firstly, many of these are only available to existing customers, as otherwise the demand would be too high. Some others are available to anyone that meets the eligibility requirements, but most only offer 5 or 6 months to repay the balance before interest starts being charged. You must therefore make sure that you can repay the transferred balance within the relatively short time period so that you can avoid being charged interest.
Which is better no fee or 0%?
This comes down to maths - working out exactly how much you want to transfer – how much you can pay back each month - and then the costs involved on each deal type.
If you want to find out more on how to work out the costs and weigh up the differences exactly, please read our FAQ "Which is better a no fee balance transfer or a 0% rate?".
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