Balance Transfer for the Life of the Balance

Getting a 0% APR credit card for life is kind of like spotting a dodo bird in the wild, despite it being extinct for several hundred years. Sure, it could happen, maybe, but it’s pretty unlikely.

However, many credit card balance transfers give you the option to lock-in a low balance transfer rate for life (of the balance that is), meaning until it’s all paid off in full.

In that respect, they’re essentially fixed-rate balance transfer credit cards because the rate never changes.

Unfortunately, you probably won’t find a balance transfer that offers 0% APR on balance transfers for the life of the balance. At least not now that the “scam” is over.

Discover Used to Offer 0% APR for Life, with a Major Catch…

A few years back, credit card issuer Discover was offering “0% APR for life” on some of its balance transfer offers. Of course, there was a major catch.

You had to make several purchases each billing cycle using the balance transfer credit card.

This may seem like no big deal. Heck, buy gas once a month, grab a cup of coffee, use it at the grocery store, pay it off. No biggie, right?

Wrong. Up until a couple months ago, credit card issuers employed a rather dubious method called negative payment hierarchy.

The way it works is pretty simple. Imagine you took up Discover on their 0% APR balance transfer for life and moved $5,000 to the new credit card.

You wouldn’t pay any credit card finance charges on that balance for life. Amazing deal, right? Well, not so fast.

Let’s suppose they required you to make two purchases every billing cycle, aka every month. And let’s say you bought gas for $50 and groceries for an additional $50 during the first month. You’d have a balance of $5,100 on the new balance transfer credit card.

So when you go to make your first credit card payment, you decide to pay for the entire $100 in purchase activity because you don’t want to accrue any interest. After all, that’s why you chose the 0% APR balance transfer for life, right?

Well, negative payment hierarchy ensures that the lowest APR balances are paid off first, then the higher APR balances.

And guess what the lowest APR is.  The 0% APR for life on the balance transfer amount.

In short, the $5,000 balance transfer set at 0% APR for life would need to paid off in full before any of the purchases, which are set at a much higher 19.99% APR.

So if you didn’t pay off the $5,000 within the first year, you’d owe more than $20 for just those two purchases the first month.

Now imagine it compounding month after month until you’ve got a sizable purchase balance stuck at 19.99% APR and you can see where this “special offer” gets really ugly.

Fortunately, negative payment hierarchy was done away with thanks to the Credit Card Bill of Rights enacted back in February 2010.

So this type of credit card trickery will no longer work, and you can kiss goodbye the notion of a zero percent balance transfer for life. It just doesn’t make sense to the card issuer. How would they actually make money?

That being said, this is actually good news for cardholders because it was a bit of a scam.  But I wouldn’t be surprised if another gimmick comes along down the road, so be vigilant.

Just remember, nothing is too good to be true, and sometimes it’s better to opt for a low fixed rate for the life of the balance with no gimmicks than it is to attempt to save every penny with the aforementioned plan.

Balance Transfers for Life Commonly Have APR That Exceeds 0%:

Current balance: $2,000
Current APR: 19.99%
Balance transfer offer: 3.99% APR for life of the balance
Balance transfer fee: $0

In our example, you’d be paying roughly $400 annually in finance charges at the current 19.99% interest rate.

If you elected to accept the balance transfer offer at 3.99% APR for the life of the balance, you’d be paying 3.99% on the $2,000 balance until it was paid off (about $80 descending annually as the balance falls).

Now you would have the choice to pay it off in six months or six years, but you’d enjoy that low fixed rate for the entire duration, regardless of how you choose to tackle the debt. This is the main advantage, especially for those with a large credit card balance that they know can’t be paid off in just 12 months.

So balance transfers that have a fixed APR for the life of the balance may be more attractive than 0% APR balance transfers, but you’ll have to do the math.

Life of the Balance Offers Currently Available

Last updated April 6th, 2017…

1st MidAmerica Credit Union (IL, MO) is offering a life of the balance transfer with no fees of any kind (balance transfer and annual fee that is). The APR is set at a low 5.9% for life as long as you make the transfer within the first six months of account opening.

Acadia FCU (ME) offers 4.99% APR fixed for the life of your loan. Check on fees.

Achieve Financial Credit Union (CT) is offering a 6.99% fixed APR balance transfer for the life of the transferred balance with no balance transfer fees and no annual fee.

Altra Federal Credit Union (AR, CO, KY, MN, TN, TX, WI) has a life of the balance offer as low as 5.90% APR fixed for life. That means your interest rate stays that low until you pay off your balance in full. That’s pretty good, not to mention they don’t charge a balance transfer fee. In case you didn’t know, credit unions are a goldmine for balance transfer offers…

APS Federal Credit Union Visa (PA, employees of Allegheny Energy and its wholly-owned subsidiaries) comes with a low 5.99% APR on balance transfers until the balance is paid in full.

Birmingham Bloomfield Credit Union (MI) offers a super low 3.9% APR for the life of the transfer with no balance transfer fees. Hard to pass this one up if you have high-APR credit card debt.

Amherst Federal Credit Union (NY) is offering a fairly low fixed rate of 6.95% APR until your transferred credit card balance is paid off in full. Unsure on the fees for this offer.

Coastal Community and Teachers Credit Union (TX) offers a no-fee life of the balance offer at a low 6.99% APR. Your rate won’t adjust or ever change!

Central Florida Postal Credit Union (FL) is offering a 5.99% APR fixed balance transfer for the life of the transfer to help you get rid of your holiday debt. Ask about fees.

Chicago Patrolmen’s Federal Credit Union (IL) offers rates as low as 3.90% APR for the life of the balance transferred. Oh, and I did I mention no balance transfer fee or annual fee. Wow!

Commodore Perry FCU (OH) is offering a rock-bottom 3.99% APR on balance transfers until it’s paid off. Oh, and sans fees!

Dade County Federal Credit Union (FL) offers a fantastic 0% APR for the first 180 days on balance transfers at which point the APR rises to a still low 3.99% for the life of the balance!

Day Air Credit Union (OH) offers a life of the balance transfer set at 6.50% APR with no annual fee and I believe no balance transfer fee. Pretty low but you can possibly do better.

FAST Federal Credit Union (CA) offers a low balance transfer for life of 6.99% APR until the transferred balance is paid in full with no fees to transfer.

Five County Credit Union (ME) offers 6.99% APR “until that balance is paid” on balance transfers. Unsure if there is a balance transfer fee or annual fee.

Five Star Credit Union Visa (AL, GA) is offering a 5.99% APR balance transfer for life with no transfer fee or annual fee.

Friends & Famly Credit Union (OH) has rates as low as 4.99% APR that are fixed until the balance is paid off with no annual fee or balance transfer fee

Global Credit Union (ID, WA) offers an amazingly low 3.99% APR on balance transfers that remains for the life of the balance with NO fee to transfer an no annual fee. I don’t see anyone beating this deal.

Guardians Credit Union (FL) offers 4.9% APR on balance transfers for the life of the loan with no balance transfer or cash advance fees. No annual fee either.

IBM Southeast Employees Credit Union (FL) is offering 4.90% APR on balance transfers for the life of the transaction with no fees!

The Interior FCU Visa Credit Card (DC, VA) comes with 2.9% APR for 60 months on balance transfers with no annual fee and maybe no balance transfer fee (couldn’t find the terms). That could effectively be for life if you can manage to pay off your balance in five years.

Jax Federal Credit Union (FL) wants you to “dig out of debt” with their 5% APR life of the balance transfer with no annual fee or balance transfer fee. Excellent credit required.

Justice Federal Credit Union (CA, DC, GA, IL, NY, TX, VA, WV) offers 4.49% APR for 24 months with no balance transfer fee. For some this may be long enough to pay off all the debt.

Leaders Credit Union (TN) offers 7.99% APR on balance transfers for life with no balance transfer fees! You may be able to parlay the offer with 0% APR for the first six months.

Lowland Credit Union (TN) offers rates as low as 6.25% APR with no balance transfer fee and no annual fee. Depends on your credit history but could be a good deal for some.

Manatee Community Federal Credit Union (FL) offers a fixed rate of 7.99% APR until transferred balance is paid in full. They offer a free balance transfer service (you just come in and provide your statements) and don’t charge an annual fee.

Maumee Valley FCU (OH) is offering 6.9% APR for the life of the loan with no balance transfer fees! Not a bad deal.

NASA Federal Credit Union (DC, MD, VA) currently has a life of the balance offer set at 7.9% APR with no balance transfer fee and no annual fee. This could make sense if your APR is sky-high, but you’re probably better off looking for a 0% APR option instead.

New Jersey Law and Public Safety Credit Union (NJ) offers 5.99% APR for the life of the transferred balance (up to $15,000) and no balance transfer fee for the first 150 applicants.

Northrop Gruman FCU (CA, FL, IL, LA, MD, VA) is offering a very attractive fixed 4.99% APR on balance transfers until they are paid in full. And no balance transfer fee!

Novation Credit Union (MN, 3M employees) is offering a stellar 3.90% APR for the life of all credit card balances transferred. Hard to beat that rate, ask about fees.

NW Preferred FCU Visa (OR) comes with 4.99% APR fixed for the life of the balance transferred and doesn’t charge a cash advance or balance transfer fee.

Palco FCU (PA) offers 5.9% APR until the balance transfer is paid in full. No annual fee, no balance transfer fees, and no cash advance fees. Good deal.

Saginaw Medical FCU (MI) has a special 5.90% APR for life on transferred balances without transfer fees.

San Antonio Citizens FCU (TX) is offering 4.99% APR for the life of the balance with no transfer or transaction fees. Not too shabby!

Saratoga’s Community FCU (NY) offers 6.99% APR on balance transfers until the balance is paid off. No annual fee or balance transfer fees!

SC State Federal Credit Union (SC) offers a rate as low as 5.9% APR for three years, which should be enough time for most folks with no transfer fee or annual fee.

School Employees Lorain County Credit Union (OH) offers an awesome 3.99% APR until your balance amount is paid in full. I don’t think they charge a fee either, but verify.

SECU (MD) based out of Baltimore offers 5.99% fixed APR for the life of the balance with no balance transfer fees of any kind. Good deal.

Security Credit Union (MI) gives you zero APR for the first six months then a low 4.99% APR for the life of the remaining balance! All this with no annual fee or balance transfer fee. Impressive.

SESLOC Federal Credit Union (CA) is offering a reasonable fixed rate of 7.90% APR and they arrange free balance tranfers (no fee).

Signal Financial Federal Credit Union (DC, MD, VA) offers a super low 2.95% for a long 24 months on balance transfers, 3.95% for 36 months, or 4.95% for 48 months with NO balance transfer fee (assume no annual fee either).

Streator Onized Credit Union (IL) offers a near lifetime (60 months) of 4.99% APR on balance transfers with I believe no fees.

Suncoast Credit Union (FL) offers a very low 3.9% APR until the balance is paid in full with no annual fee and no balance transfer processing fee, as they call it. This is the lowest lifetime offer I’ve come across lately.

SunTrust Prime Rewards Credit Card (various Southeast states) offers 36 months at the prime rate (variable) with no balance transfer fee. Most people should be able to pay off their credit card(s) in three years time.

Susquehanna Valley Federal Credit Union Visa (PA) comes with a relatively low 6.9% APR on balance transfers until paid in full. They don’t charge a balance transfer fee or annual fee.

TDECU (TX) gives you a low 5.9% APR until the transferred balance is paid in full with no balance transfer fees.

Team One Credit Union (MI) is offering 4.9% APR on balance transfers for life and there don’t appear to be any fees. Great offer!

Tongass FCU (AK) offers a low fixed rate of 7.99% APR on balance transfers until it’s paid off in full. No fees.

University Credit Union (FL) has a relatively low fixed rate of 6.99% APR for the life of the transaction without fees.

USF Federal Credit Union (FL) is offering a very low rate of 4.99% APR on balance transfers for 3 years with no balance transfer fee. Great offer!

Western Connecticut FCU (CT) offers 5.99% APR on balance transfers that is valid for the life of the balance. No annual fee or balance transfer fee!

Western New York Federal Credit Union (NY) offers a special rate of 5.99% APR until the balance of the credit card is paid in full. Unsure about the fees, so be sure to inquire with them.

0% APR or a Low Fixed-Rate for Life?

Current balance: $2,000
Current APR: 19.99%
Balance transfer offer: 0% APR for 12 months, 12.99% thereafter
Balance transfer fee: 5%

In this example, you’d immediately be hit with a $100 balance transfer fee, raising your balance to $2,100.

However, you wouldn’t accrue any interest for 12 months, and ideally could pay down the debt pretty quickly.

But even if you paid off the entire $2,100 within a year (during the promotional 0% APR period), it would still cost more than the $80 in finance charges you’d pay if you went with our life of the balance offer example.

And assuming you didn’t pay it off in full within 12 months, the remaining balance would be subject to the 12.99% APR, making it even more expensive than the life of the balance offer.

So in conclusion, the life of the balance offer could make more sense in our example. But you really have to set up a plan of attack to determine which will be the better deal for your particular situation.

Perhaps the best solution would be going with a no fee balance transfer offer first, and then shifting the remaining debt to a low fixed rate balance transfer after.  This could be the most cost effective.

Tip: Make sure you create a plan to pay off the debt first, read the fine print, and shop around to ensure you get the best balance transfer deal.