The first balance transfer deal I ever did was using a BofA credit card. That was a few years ago and I remember the offer was rather unexciting; it only gave 0 percent for 12 months.
Are the deals any better now? Perhaps. Here are some things to consider:
The balance transfer fee
A couple years ago Bank of America jacked up their balance transfer fees to 4 percent, but now that fee is back at 3 percent.
In their defense, 3 percent is fairly average these days. Although the Chase Slate is currently charging no balance transfer fee if you make a transfer within 60 days of opening your account, 3 percent is pretty much the standard across issuers. Just make sure to calculate the fee on the amount you’re transferring and make sure it’s lower than the amount of interest you’d otherwise pay over the length of the 0 percent period (it often is).
The length of the 0 percent period
If you’re going to pay a balance transfer fee, you want the 0 percent APR to last for an uber-long period of time, right? Bank of America is currently offering 18 billing cycles interest free on its BankAmericard® Credit Card.
That’s not bad (other cards offer you 12 months or less). But you can get 0 percent APR for up to 18 months from the other guys.
The credit limit
With the economic uncertainty the world has experienced over the past several years, it’s totally understandable why banks are being more cautious (and they should be!). However I don’t think that gives them a right to cut someone’s credit limit for no good reason, without any advanced notice.
There are a large number of online complaints from consumers who have had this happen with their Bank of America credit cards. Often, the reasoning behind the decision leaves one scratching their head.
In fact, here’s how counter-intuitive some of the scenarios are where this reportedly happens:
- A customer of 5+ years with no late payments had her available credit cut from $12,800 to $6,800 after she made a $3,000 payment towards her balance.
- A customer carrying a $2,700 balance (with $5,600 limit) called customer service and as a result, his limit was unexpectedly shaved down to $3,000… leaving him with 90 percent credit utilization.
For these stories and others, see the older post about BofA decreasing credit limits.
While Bank of America’s balance transfer offers have gotten better over the past couple years, they don’t have the lowest fees or the longest intro periods out there. When there are so many 0 percent offers on the market, choosing BofA over the competition won’t always be the right route to take.
Updated Feb. 19, 2014