Can you get a balance transfer card with bad credit?
Editor's Note
A balance transfer is an excellent way to consolidate debt across one or several credit cards onto one card with a promotional annual percentage rate. Balance transfer offers regularly appear for those with good credit, but what about those with bad credit?
Unfortunately, balance transfer offers for bad credit are typically much harder to come by — a low FICO score indicates risky spending and payment habits, resulting in missed payments, high credit utilization and other negative factors.
Subsequently, balance transfer options are scant for individuals with bad credit, whether they're looking to open a new card to take advantage of a publicly available 0% annual percentage rate (APR) or hoping to receive a balance transfer option on cards they already hold.
Here are some things to keep in mind when looking for a balance transfer when you've got bad credit.
Can you balance transfer with bad credit?
A FICO score lower than 630 is considered "bad credit" and is a key barrier to those looking for balance transfer opportunities or the chance to consolidate credit card debt. The purpose of a balance transfer is to have a reduced or 0% interest rate, which can help borrowers save on interest and pay off debt quickly.
Balance transfer cards for bad credit may be approved for some individuals, but based on credit history and factors affecting FICO scores, you may receive a low credit limit, which may not be useful if you're looking to move over a large amount of debt or consolidate numerous cards.
Keep in mind that balance transfers are not free; they usually have a 3% to 5% fee associated with them, so a $5,000 transfer could result in fees of as much as $250.
Applying for a new card may further lower your FICO score temporarily because it results in a hard inquiry on your credit report. In the long term, it may also affect your credit score if you are maxing out your credit limit, thus negatively affecting your credit utilization ratio.
Related: How to do a balance transfer
Are there balance transfer credit cards for bad credit?
Within the world of credit cards, no credit cards specifically offer balance transfers for bad credit.
Most issuers will approve new credit cards to those with fair to excellent credit, and issuers such as Chase or Discover may have 0% APR offers available. However, they tend to be reserved for those with at least good credit scores of over 670.
An alternative to looking for balance transfer credit cards for bad credit is to look in your wallet to see if you already hold a credit card that may have a balance transfer offer.
Cards such as the Chase Slate® (see rates and fees) occasionally offer low introductory APRs and 0% APRs. So, if you have a card you aren't using, it may be better to log in to your online account and check for any offers before applying for a new credit card.
Related: What is a balance transfer?
Alternatives to balance transfers
Looking for balance transfer credit cards with bad credit can take time and effort. However, if you find yourself limited, there are some alternatives.
Payoff strategy
If you aren't having any luck with balance transfers due to bad credit, draft a plan to pay off the debt. If you carry debt across several credit cards, consider paying off the card with the lowest balance first, as this can help reduce your overall credit utilization and increase your credit score.
Consolidate debt
Another alternative to balance transfers is a debt consolidation loan. These personal loans combine debt from multiple cards into one overall debt, and interest rates are usually lower than those on credit cards.
Although those with bad credit may not receive the best interest rate, this method allows you to combine all your debt into one place and not worry about multiple payments, due dates or late fees.
Negotiate APR
It's worth calling your credit card issuer to see if your APR can be lowered. Although not a guarantee, some issuers may lower your APR, which can help you save on monthly interest charges.
Managing expenses
If balance transfers and debt loan consolidation aren't options for you, a passive alternative is to better manage expenses. Charting your expenses, budgeting and reducing them in areas can increase your purchasing power, enabling you to pay off larger portions of the debt.
Some techniques I have used to manage my expenses include creating a list of monthly expenses and using budgeting apps to see where additional costs can be removed.
Related: The pros and cons of balance transfer credit cards
Bottom line
Balance transfer cards for bad credit are not readily available. It's also important to remember that balance transfers incur fees, further adding to debt.
If you cannot apply for a balance transfer credit card with bad credit, explore alternatives such as checking balance transfer offers on existing credit cards, drafting a payoff strategy or applying for a debt consolidation loan to pay off your balances more quickly.
Related reading:
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