My Balance Transfer Period Ended And I Still Have Debt. What Now?

A steadiness switch bank card can give you many months to repay high-interest debt within the type of a 0% introductory APR. However when that steadiness switch interval ends, curiosity prices are added to the steadiness if it isn’t paid off.

To keep away from paying curiosity in your transferred steadiness, goal to have it paid in full when the promotional interval ends. However what if that’s not potential?

Almost 50 p.c of cardholders are carrying a steadiness from month to month as an alternative of paying off their card in full, in response to a November 2023 Bankrate survey. This proportion is a gradual rise from the 39 p.c of cardholders who have been carrying balances in 2021, and it isn’t slowing.

When you’ve additionally discovered your self on this place together with your steadiness switch bank card nearing the tip of its introductory interval, you’ll have to attempt to give you a plan to wipe out the remaining steadiness earlier than the curiosity prices pile up. This text may also help you perceive your choices and work out what plan works finest for you.

What occurs when the steadiness switch supply expires?

Earlier than diving into subsequent steps, we’ll first go over what occurs when your introductory steadiness switch supply expires.

The APR — or annual proportion price — on a bank card represents the curiosity you’re charged in your card’s steadiness over a 12-month interval. Introductory gives are particular gives for brand new cardholders from bank card issuers that final for a specified time period. As soon as that point interval ends to your steadiness switch bank card, the cardboard’s ongoing APR will apply to your remaining bank card steadiness.

The upper the bank card steadiness is when the 0 p.c APR interval ends, the extra curiosity you’ll accrue. Let’s say you might have $1,000 left in your bank card on the finish of your introductory supply. If the common APR is 24 p.c and also you resolve to pay $100 per thirty days till your steadiness is zero, it is going to take you twelve months to get there. That’s as a result of along with the $1,000 you borrowed, you’ll pay $127 in curiosity.

When you’re nearing the tip of your introductory interval, take the time to plug your personal numbers into Bankrate’s bank card payoff calculator to learn the way lengthy it might take you to repay your remaining steadiness.

What to do in the event you nonetheless have debt after your steadiness interval switch ends

The perfect plan of action when you might have a steadiness in your bank card is to pay it in full on the finish of your billing cycle. However in the event you’re approaching the tip of your promotional 0 p.c APR interval and nonetheless have a steadiness, there are a variety of strikes you can also make. You possibly can:

Make a lump sum cost

Making a lump sum cost is your easiest and least costly possibility you probably have a steadiness remaining when your steadiness switch interval ends. You’ll keep away from any curiosity prices through the use of any financial savings or additional money you will have to repay the steadiness switch card. Contemplate how a lot — if any — money readily available you’ll want within the close to future and weigh that in opposition to your have to pay down your bank card steadiness. If potential, use your money to wipe away the remainder of your card’s debt.

Depart the steadiness on the present bank card and revamp your cost plan

When you’re unable to pay your card’s steadiness in full and don’t wish to apply for one more card, make a brand new plan to pay the present card steadiness. Deal with any budgeting points which may be stopping you from tackling your bank card steadiness, and attempt to pay the steadiness off as rapidly as you possibly can.

When you discover which you could solely make minimal funds, nevertheless, then this feature can get costly fairly rapidly. The common bank card rates of interest on most steadiness switch playing cards are comparatively excessive, so don’t hesitate to tighten your finances fairly a bit if vital.

Contemplate a debt consolidation mortgage

To keep away from your bank card’s excessive rate of interest and eliminate your debt with one cost, you may take out a debt consolidation mortgage. This can be a useful device for managing your debt as a result of it permits you to use one mortgage to repay a number of high-interest money owed — sometimes bank cards — over a time period, with mounted month-to-month funds. If the rate of interest on the mortgage is lower than the APR in your present steadiness switch card, you’ll see some financial savings.

Switch the steadiness to a different 0% APR card

It may be potential to switch your current steadiness to a different 0 p.c APR steadiness switch bank card when your present card’s steadiness switch interval ends. This provides you the chance to pay the steadiness off interest-free for a second time. There’s no official restrict to what number of steadiness switch playing cards you possibly can join, however you sometimes received’t have the ability to switch your steadiness to a different card from the identical issuer. Plus, particular person bank card issuers have their very own guidelines surrounding steadiness transfers, so that you’ll must be aware of them as you apply for a brand new card.

Needless to say in the event you go along with this route, you’ll have to pay one other steadiness switch price, and your credit score will likely be pulled every time you apply for a brand new card, which may decrease your credit score rating. It additionally received’t decrease the quantity you owe or handle any points that may be inflicting you to hold bank card debt.

The underside line

The perfect steadiness switch bank cards can doubtlessly prevent a whole bunch in curiosity. Paying your steadiness in full earlier than the introductory interval is over ought to be your fundamental objective when transferring a steadiness, but when that’s not potential, it’s crucial to create a backup plan. When you didn’t have a plan for utilizing your steadiness switch bank card’s introductory interval to its full potential the primary time round, you possibly can nonetheless efficiently handle your bank card debt with the suitable technique.

When you’re nonetheless unsure the place to start and are anxious in regards to the ensuing curiosity out of your bank card, think about reaching out to a credit score counseling company. A licensed counselor from an accredited non-profit can doubtlessly assist you give you a plan to repay your debt.