Canada’s Best Balance Transfer Credit Cards 2019 - MoneySense

Canada’s Best Balance Transfer Credit Cards 2019

These cards offer super low introductory rates for balance transfers

by

Are you longing to be debt-free but struggling with high-interest cards? Then a balance transfer credit card, which allows you to move the balance off of some or all of your credit cards over to this new card at a super low-interest rate if you sign up (sometimes even as low as 0%) can be a good strategy for you. Just keep in mind that these great low rates are limited and when that period ends—often six months only—the rates will go back up.

The best balance transfer credit cards in Canada 2019


MBNA True Line MasterCard*

Free: No annual fee

Balance transfer offer: No annual interest on balance transfer fees for the first ten months (3% fee also applies). After 10 months, the rate increases to only 12.99%.

Other benefits: Around-the-clock fraud protection and access to 24/7 customer service.

NOTE: APR and balance transfer offer is different for residents of Quebec

Click here for more details about the True Line MasterCard*


MBNA True Line Gold MasterCard*

Low fee: $39 a year

Welcome balance transfer offer: No annual interest on balance transfer fees for the first 6 months (3% fee also applies), and rate increases to only 8.99% after that.

Low rate on purchases: 8.99% interest rate on purchases (and 24.99% on cash advances).

Fraud protection: Around the clock protection against fraudulent charges.

NOTE: APR and balance transfer offer is different for residents of Quebec

Click here for more details about the True Line Gold MasterCard*


Scotiabank Value Visa*

Super-low rate on balance transfers: 0.99% interest on balance transfers for the first 6 months. After 6 months, the rate increases to a modest 12.99%.

Decent rate on purchases and cash advances: 12.99%

Low annual fee: $29

Save on car rentals: Get a 25% discount on rental cars at participating Avis locations.

Click here for more details about the Scotiabank Value Visa*


Honorable Mention

PC Financial World Elite MasterCard *

Introductory balance transfer rate: 0.97% for the first 6 months. But after that, the balance transfer rate increases to a much higher rate of 22.97%

Earn points: 40 PC points per dollar at Shoppers Drug Mart, 30 points per dollar at PC Stores that include Loblaws, No Frills, Real Canadian Superstore, PC Travel, Esso and Joe Fresh, and 10 points everywhere else.

Rock bottom cost: Free to use, so no annual fee.

Travel Emergency medical insurance: Covers you if you are under the age of 65 and travelling for 10 days or less.

Click here for more details about the PC Financial World Elite MasterCard*


What is a balance transfer?

A balance transfer is the transfer of debt from one credit card to another. Although a cardholder can transfer their debt for any variety of reasons, the goal is usually to move the debt to a lower interest rate card, to cut down on the amount of interest charged and pay off the loan faster.

As most everyday-use credit cards command an interest rate of around 20%, your principal debt load can bloat quickly. By transferring debt to a card with a lower interest rate, you’ll incur lower interest charges—so more of your money goes to the principal balance. Less interest means less debt, so you can pay down your liability faster.


Important things to know about balance transfer credit cards

Balance transfers can be an effective strategy for consolidating and addressing debt. But before you jump in, there are four main variables you need to understand.

  • Shop around for the rate, timing and terms that suit you
    If you’re considering a balance transfer to eliminate debt, your best bet might be a balance transfer credit card. These cards come with promotions that let cardholders pay very low interest (as little as 0% – 1.99%) for a limited amount of time (like 6 or 10 months). These offers can be a really effective way to bring down your debt, fast. What card you choose will depend largely on what is available at the time you’re looking, how long you think you need to pay off your debt, and the rest of the product’s terms.
  • Balance transfer promotions don’t last forever
    The low single-digit rates available on balance transfer credit cards are limited-time offers, and once the promotional period is over, the card’s regular interest rate will kick in. How you handle this will depend on the amount of your debt and how quickly you think you can pay it off, but in general the best strategy is to pay off your balance before the balance transfer offer ends, and to pick a card with a low regular interest rate. This way, you’re saving money even if you still owe after the offer period.
  • Balance transfer fees
    Some—but not all—cards charge a transfer fee on balance transfers. This fee is expressed as a percentage of the total amount you want to move, and is usually between 1% and 3%. So, for example, if you’re looking to transfer $1,000 in debt to a card with a 3% fee, your opening balance will be $1,030. This additional cost may well be worth the money you’ll save at the new lower interest rate, but keep your eyes open: Occasionally, a card will run a promotion where they waive the balance transfer fee.
  • Separate your expenses
    It can be tempting to consolidate your expenses all in one place, but beware: if you charge a new purchase to your balance transfer card, this spend will be charged at the card’s regular interest rate, not the promotional rate. This might not seem like a big deal, especially if you’ve been lucky enough to find a card with a lower regular rate, but there’s an additional catch. Most credit cards apply payments to debt marked at the low or promotional rate first, which means your high-interest purchases are sitting there longer, racking up interest. If you’re trying to pay down debt, this only compounds the problem. It’s good practice to leave your balance transfer card at home and use a different financial product (like debit, cash, or even a different credit card) for new purchases.


In-Depth: THE BEST CREDIT CARDS BY CATEGORY


Our methodology

For the Best Balance Transfer Credit Cards 2019 ranking, we categorized credit cards based on their limited-time balance transfer rates. Our rankings also took into account fixed annual interest rates on balance transfers and purchases, purchase protections and annual fees.

‡MoneySense.ca and Ratehub.ca are both owned by parent company Ratehub Inc. We may be partnered with some financial institutions, but this does not influence the “Canada’s Best Credit Card” rankings. You can read more about this in our Editorial Code of Conduct.