The three banks now offer decent balance transfer periods with low fees.
There has been a flurry of new 0% credit cards offering 32 months interest free on balance transfers and with much lower balance transfer fees than before.
Lloyds Bank and Bank of Scotland now offer 32-month cards with 1.69% fees, while Virgin Money has one with a 1.75% fee.
These are part of a growing trend of increasingly lower fees on longer-term 0% balance transfer cards.
Let’s how have a look at what the cards offer in more detail and how they compare.
New 32-month cards
The Lloyds Bank and Bank of Scotland cards both charge an initial fee of 3% of the balance you’re transferring, of which 1.31% is then refunded so long as you made your balance transfer within 90 days of opening your card account.
The Virgin card, meanwhile, has a flat 1.75% balance transfer fee. It also offers a 32-month interest-free period on money transfers, where you transfer money into your current account, with a fee of 4% of the amount you want to transfer.
All three cards offer a six-month 0% period on purchases, although if you’re using one to pay off debt from other credit cards you should really steer clear of spending on it too.
They also have the same representative APR (the annual combination of interest and charges if you don’t pay off your balance in full each month) of 18.9%.
How they compare
You can get balance transfer cards offering interest-free periods of 36 months from Barclaycard (2.39% fee), Halifax (2.49% fee), Virgin Money (2.5% fee), MBNA (2.99% fee), Lloyds Bank (3% fee) and Bank of Scotland (3% fee).
[SPOTLIGHT]However, if you can pay off your debt four months quicker you could save some money on your fee, depending on how much debt you have to shift.
For example, if you have £2,000 to pay off, you would pay a fee of £47.80 on the Barclaycard 36-month card but only £33.80 if you opt for the Lloyds or Bank of Scotland 32-month cards.
But choosing the lowest fee and a shorter 0% period only makes sense if you can pay off your debt before the interest-free period ends and you get charged interest.
If you think you could pay off your debts in even less time, it’s worth pointing out that you could pay an even smaller balance transfer fee, or none at all if you can pay it off in 18 months.
Here are the 0% cards with the top combinations of balance transfer period and fee.
|
Credit card |
0% period on balance transfers |
Balance transfer fee |
Fee paid on £2,000 transfer |
Representative APR after 0% period ends |
|
23 months |
None |
£0 |
16.5% |
|
|
18 months |
None |
£0 |
18.9% |
|
|
19 months |
1% |
£20 |
18.9% |
|
|
24 months |
1.15% |
£23 |
18.9% |
|
|
26 months |
1.25% |
£25 |
18.9% |
|
|
28 months |
1.35% |
£27 |
18.9% |
|
|
Lloyds Bank/Bank of Scotland Platinum 32-Month cards |
32 months |
1.69% |
£33.80 |
18.9% |
|
34 months |
2.25% |
£45 |
18.9% |
|
|
35 months |
2.29% |
£45.80 |
18.9% |
|
| Barclaycard 36-Month Platinum card | 36 months | 2.39% | £47.80 | 18.9% |
*£24 annual fee
Things to remember
All of the above cards are only open to people with a good credit rating. If yours isn't great, take a look at the tips in our How to improve your credit rating guide.
Again, you should make sure you can pay off your debt before the end of the 0% period to avoid being charged interest. And you must make sure you make at least the minimum repayment each month or you will lose your 0% deal and get a black mark on your credit rating.