If you have a credit card you have probably received balance transfer offers which offer to lower your interest rate. Make sure to factor in the balance transfer fees and to look at the actual interest rate before accepting one of these offers. They often have a 3% (or more) balance transfer fee that is applied to the entire balance you are transferring. And, many times balance transfers are charged a higher APR than normal purchases after the promotional interest rate expires.
For example, if you borrow $1,000 with a 3% balance transfer fee, six months at 0% interest, and a default 18% balance transfer APR then over the course of a year the transfer will have nearly a 12% effective APR for that first year. Beyond that, you are paying 18% on that debt.
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