I am thinking of transferring a balance to my Capital One Cash Rewards card, but am wondering how that will affect my current usage of the card. The transfer fee is decent -- 2%, but I currently use the card for daily purchases (for the Cash Rewards), and then pay it off. If I transfer a balance (which will carry 0% interest for 1 year), then make purchases that I will want to pay off quickly (lest they accrue interest), will this mess up my ability to monthly pay off the interest bearing portion?
Shawn2013-11-23T19:30:45Z
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Payments nearly always count against the balances with the lowest interest. So, when you make purchases and try to pay them off, your transfer balance will be one that will be paid off first.
If you are transferring a significant balance from what I assume to be is a much higher APR card, then don't use the card till you can pay off the entire balance. Use another card for purchases till you pay it off.
Read the fine print. Some cards have bowed to the public pressure that the normal charges are paid first, and then additional $ are applied to the 0%. {I just go one like that.}
But your question is awkward. You do not exactly transfer balances. You borrow against Card A to pay the debt you have on Card B (by sending the $ of card A to BANK B) then you start repaying Card A.
So did Cash Rewards offer to loan you money at 0% with a 2% transfer fee? - but be aware this is not eligible for cash back rewards, if that is your reason.
I tried something like this once with a different credit card company. It did screw up things. The problem was that every time I made a payment, they counted it as paying off part of the 0% APR balance, not the purchases, so none of the purchase balance got paid until I paid off everything.