Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Credit Cards
Profile Image

Question By
egyptian42

0 Contributions
0 People Helped
Balance transfer with transaction fee versus straight interest.
I intend to charge a large dental bill to a credit card. My bank is offering an interest free balance transfer for 18 months with a 3% transfer fee. How do I figure out whether I would I would pay more in interest if I just charged it without the balance transfer and paid it off in the same 18 months?

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
1884 Contributions
3676 People Helped

I hate math....

But the easiest way to view it :  

if your dental work will cost $2000.  

A 3% transfer fee will be $2000. x .03 = $60.   $2060./18 months = $114.44 monthly payment.  Also be aware that if the Balance transfer is not paid off before the promo ends you may be responsible for the interest on the whole amount so you always want to pay off those promo transfers on time. 

A credit card charging 19% APR  would be $2000 x .19 = $380 per year  x 1.5 yr = $ 570    $2570./18 mo =142.77 monthly payment to pay off in the same time.  

These numbers aren't exact since interest is charged on the balance due on the day its calculated, But this will give you a general idea of how much it would cost either way. 

 Good Luck

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.