How does a balance transfer credit card work?

When you're accepted for a balance transfer card, you give the new provider the details of the card or cards you want to move debt from. The new provider pays off that amount, and the debt moves to your new card. You then repay the new provider instead.

Offers usually only apply to transfers made within a set period after the account is opened, so check the deadline. Most providers won't let you transfer a balance between two cards from the same banking group.

A 0% offer doesn't mean the transfer is free. The main costs to check are:

• The balance transfer fee — usually a percentage of the amount moved, added to your new balance
• The length of the promotional period and the date it ends
• The standard interest rate that applies once the offer ends
• The interest rate on any new purchases, which may be different from the transfer rate
• Any fees for late payments or going over your credit limit

Most balance transfer offers can be withdrawn if you miss a payment or go over your credit limit. That can mean the remaining balance starts being charged at the standard rate straight away. Setting up a direct debit for at least the minimum payment can help avoid this.

Paying only the minimum each month may leave a large balance when the offer ends. Dividing the total by the number of months in the promotional period gives a monthly figure that would clear it in time, if that's affordable for you.

Credit card adverts show a representative APR. At least 51% of accepted applicants must get that rate or better, so you could be offered a higher rate, a shorter 0% period or a lower credit limit than advertised. If your credit limit is lower than your existing debt, you may only be able to move part of it.

Each full application leaves a hard search on your credit file. Many providers and comparison services offer an eligibility checker that doesn't affect your credit file, which can show your likelihood of being accepted before you apply.

A balance transfer can reduce the interest you pay, but it doesn't reduce the debt itself, and it may not be suitable if you're already finding repayments hard. Free, confidential debt help is available from MoneyHelper (moneyhelper.org.uk), StepChange and National Debtline. They can help you look at your options, and using them doesn't cost anything.