Halifax has upped its game in the balance transfer stakes by launching a 30-month 0% card.
Halifax has launched its longest-ever 0% balance transfer credit card, boasting an interest-free period of 30 months.
There is a 3% fee attached to any transfers and an APR of 18.9%.
Providers are in fierce competition in the balance transfer market, with all sorts of cards offering well over two years free of interest on any balance you transfer.
Price war
Borrowers are in a great position to take advantage of this competitive climate, giving themselves time to clear their post-Christmas debt without having to make hefty interest payments.
The new Halifax card has a six-month 0% period on purchases, giving a little relief to borrowers who may want to spread the cost of something new over this period.
The fee of 3% is higher than that of the only other 30-month 0% card from Barclaycard. Moving a debt of £2,000 onto the Halifax card would cost £60. It’s only available online, so you won’t be able to apply in a local branch.
There is also no guarantee you'll get the full 30-months as this depends on your credit rating. At least 51% of applicants will receive the advertised rate but the rest could be offered a less-favourable deal. Checking your credit rating before you apply will give you an idea of how likely you are to get the best offer.
This area of the market is hotly contested right now, with a lot of providers are offering very similar deals, as you can see from the table below.
|
Credit card |
0% period on balance transfers |
Balance transfer fee |
Representative APR |
|
30 months |
2.89% |
18.9% |
|
|
30 months |
3% |
18.9% |
|
|
29 months |
2.49% |
18.9% |
|
|
29 months |
2.89% |
18.9% |
|
|
29 months |
2.9% |
18.9% |
|
|
29 months |
3% |
18.9% |
Choosing a balance transfer card
A balance transfer card is a good way of clearing your debts cheaply, but it only works if you use the card correctly.
[SPOTLIGHT]As soon as the 0% period ends the interest rate will kick in. If you haven’t cleared the card at this point, you’ll have to start making higher payments which could negate the benefit of the 0% period. So make sure you clear as much of your debt as possible during the interest-free term.
It’s also important to look at the fees associated with a balance transfer. On the top-rated cards these are generally quite high, such as the 3% with the Halifax card.
If you’re not moving over that much money, and don’t require 30 months to pay it off, a cheaper card with a lower fee would be more suitable. The Fluid Low Fee Visa, for example, has a fee of just 0.75% and a 0% period of 12 months.
Read The best low-fee balance transfer credit cards.