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Credit card details are up to date as of June 1st, 2019. For the most accurate and up to date information, visit the issuer's website.
Carrying debt on a high-interest credit card? One way to tackle this problem is to do a balance transfer – whereby you move debt from one high-interest credit card to a new one with a much lower (or no) interest rate. This smooth move could save you hundreds of dollars in interest, allowing you to pay down your debt faster. A balance transfer credit card is a card with very low or no monthly interest on balance transfers. Basically, you’re using one card to pay off another, while also taking advantage of a rock bottom interest rate that’ll make your payments more manageable. Here are our top picks for the best balance transfer credit cards in Canada.
Overview of Best Balance Transfer Credit Cards in Canada 2019
|Credit Card||Best For|
|MBNA True Line® Mastercard®||No Annual Fee + 0% balance transfer rate for your first 10-month|
|Scotiabank Value® Visa* Card||Very low introductory balance transfer rate|
|Tangerine Money-Back Credit Card||Cash back rewards + low introductory balance transfer rate|
|Best Western Mastercard®||Very low introductory balance transfer rate + rewards|
|American Express Essential™ Credit Card||Low Interest Rates|
|PC Financial ® Mastercard||Very low introductory balance transfer rate + rewards|
How to Choose a Balance Transfer Credit Card
When choosing a balance transfer credit card, here are five things to be on the lookout for:
- Introductory interest rate on transferred balances: The lower the interest rate, the better. Paying 0% is the best-case scenario!
- Length of promotional grace period: The amount of time the promotional rate is in effect varies card to card. The longer, the better – especially if it’s a lengthy 0% timeline.
- Balance transfer fee: Typically expressed as a percentage of the balance you’re moving, this fee is tacked onto your total.
- Annual fee: Some balance transfer cards have an annual fee, so work that into your calculations. A card with no annual fee is best for transfers.
- Regular rate: What is the interest rate after the grace period? Although your plan should be to pay down your debt before the low-interest promotion expires, you don’t want to be caught out paying a higher-than-average rate should you need to take more time.
- Rewards: Sweetening the pot, some balance transfer cards also allow you to collect rewards. Carriers of the MBNA Best Western Rewards® Mastercard® will receive 20,000 points—enough for a free night’s stay—on their first purchase plus additional points thereafter.
One thing to note: the low-interest rate for balance transfers is typically offered on an introductory basis for a finite period. After the promo expires, the balance is charged at a much higher rate. So your goal should be to pay down your balance before the promotion period ends.
Best Balance Transfer Credit Cards in Canada
MBNA True Line® Mastercard®
Balance Transfer Intro Rate: 0% for 10 months
Purchase APR: 12.99%
Balance transfer fee: 3% (minimum fee of $7.50)
Annual fee: $0
*This offer is not available for residents of Quebec. For Quebec residents, please click here.
With no annual fee, an incredible balance transfer rate, and a low purchase interest rate of 12.99%, the MBNA True Line® Mastercard® is a solid choice for those looking for a place to park and pay off their balance quickly. It’s especially enticing with the 0% promotional annual interest rate for 10 months on balance transfers completed within 90 days of account opening, with a fee of 3% of the amount transferred (minimum fee of $7.50). After that, the interest rate (APR) on transferred balances will be 12.99%.
Scotiabank Value® Visa* Card
One of the few cards on this list that carries an annual fee, the Scotiabank Value® Visa* Card is enticing because it offers an extremely low 0.99% introductory rate for 6 months on balance transfers. After that, it reverts to the regular rate at 12.99% & annual fee of $29– still a low-interest rate by industry standards. However, if you miss your mark and fail to pay off all of your transferred debt, it will accumulate interest at a much more attractive rate than with many other cards.
Tangerine Money-Back MasterCard
The Tangerine Money-Back MasterCard is offering a sweet balance transfer deal to new customers: make a transfer within 30 days of opening your account and pay only 1.95% for 6 months, after which time you will pay the standard interest rate of 19.95%. This is an attractive offer, especially combined with no annual fee and Tangerine’s cash-back benefits of 2% on eligible money-back categories. Best of all, Tangerine has a lucrative, limited-time welcome offer. As of April 22, 2019, new Tangerine Credit Card Account holders can earn 4% Money-Back Rewards on purchases in up to three Money-Back Categories of their choice, for the first three months. Apply now, because this promo expires on July 31, 2019.
Best Western Mastercard®
*This offer is not available for residents of Quebec. For residents of Quebec, please click here.
In addition to a generous 10-month grace period, the Best Western Mastercard® is a natural contender because of its rewards program. Upon sign-up, you can get a balance transfer at 1.99% for 10 months with a 1% transfer fee (minimum $7.50fee) – one of the top promotions in Canada. After that, the interest rate (APR) on transferred balances will be 22.99%. Customers earn Best Western Rewards® points on all spends that can be redeemed towards hotel stays, dining, gift cards, and more, and you will receive 20,000 Best Western Rewards® points after your first eligible purchase—that’s enough for a free one-night stay! With no annual, this card offers great perks to frequent travellers.
PC Financial ® Mastercard
For those who shop in the President’s Choice family of brands, the PC Financial ® Mastercard pairs an attractive balance transfer offer of 0.97% for 6 months with the opportunity to earn PC Optimum points that can be redeemed for groceries and eligible products. With a generous 10 points per dollar in their stores plus 25 points per dollar at Shoppers Drug Mart, it’s fast and easy to earn your way towards free gas or groceries and do it with no annual fee.
American Express Essential™ Credit Card
With the American Express Essential™ Credit Card, a great balance transfer offer and one of the lowest interest rates in Canada makes this a rare card indeed. It also offers a fixed rate — which generally means that the interest rate will not suddenly skyrocket. Other perks include purchase protection and travel accident insurance. If you're carrying a balance, this is definitely a card worth checking out. For more details about this card, visit the issuer's website.
Comparison of Best Balance Transfer Credit Cards in 2019
|Credit Card||Annual fee||Balance Transfer Intro Rate||Purchase Interest Rate (APR)||More Info|
|MBNA True Line® Mastercard®||$0||0% for 10 months||12.99%||Learn More|
|Scotiabank Value® Visa* Card||$29||0.99% for 6 month||12.99%||Learn More|
|Tangerine Money-Back Credit Card||$0||1.95% for 6 month||19.95%||Learn More|
|MBNA Best Western Mastercard®||$0||1.99% for 10 month||19.99%||Learn More|
|PC Financial ® Mastercard||$0||0.97% for 6 month||19.97%||Learn More|
Best Western Mastercard®: *This offer is not available for residents of Quebec. For residents of Quebec, please click here.
MBNA True Line® Mastercard®: *This offer is not available for residents of Quebec. For Quebec residents, please click here.
Why Get a Balance Transfer Credit Card?
Transferring a balance can be an excellent strategy for consolidating debt and getting you back in the black. When moving outstanding debt from a high-interest credit card onto a balance transfer credit card, you can either stop or greatly reduce the accumulation of interest while buying time to pay down your principal.
For example, imagine you have $2,500 in debt sitting on a credit card with the typical interest rate of 19.99%. The interest on that debt totals around $500 over a year—that’s no small change! Instead of chipping away at the debt while interest accumulates, you could send that debt over to a balance transfer credit card at a lower interest rate and pay down the principal with little or no interest accumulating. In the long-run, this savvy strategy could save you some serious coin.
In general, balance transfer cards are a very good idea for small or medium amounts of debt. Since you can transfer debt from multiple cards, they work like a charm if you’re trying to consolidate what you owe. Just make sure to read the fine print, as interest rates and grace periods vary for each credit card.
Balance Transfer Card Best Practices
Get the most from your balance transfer credit card by following these savvy strategies:
- Don’t make new purchases on your balance transfer card: Your balance transfer is charged at a low or 0% rate of interest, but there is a different interest rate for new purchases. If you make purchases on the same card, your payments will be equally split between your balance transfer and the purchase amount. The idea in using a balance transfer card is to pay down debt fast, and this simple mistake will stretch out your repayment time—and trigger interest on the purchase amount. It’s a good idea to have a separate card for new purchases, so consider leaving one of your existing accounts open—or look into getting a low-interest credit card.
- Don’t exceed your credit limit: Some companies allow overspending – and if that happens, there’s a chance of losing your introductory low-interest rate.
- Pay your minimum monthly payments: If you miss a payment deadline, you could lose your low introductory interest rate.
- Keep track of the time: Like all good things, the promotional period must come to an end. When it does, you’ll be charged at a much higher interest rate. Aim to pay off your debt in full, but failing that, give yourself time to transfer your remaining debt to another balance transfer card.
The Final Word
If you’re one of the many Canadians holding a modest amount of debt, you should definitely consider getting a balance transfer credit card to lighten the load. With typical credit card interest rates running at around 20%, a small money misstep can turn into an onerous obligation—and fast. Luckily, the smart and strategic use of balance transfer credit cards can help minimize the financial blow. Just remember to shop around for the right one: look carefully at the introductory interest rate, regular interest rate, annual fee, and balance transfer fee to see which credit card best matches your needs. With a little strategy and determination, you can eliminate your debt in no time at all.
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