Credit Card Balance Transfer Offers

A Balance Transfer That Actually Earns Cash Back Rewards

A while back I wrote about balance transfers and credit card rewards. And more specifically, that you don’t earn rewards on transferred balances.

Often it’s an exclusion when the credit card you transfer the balance to is offering rewards for spending. Put simply, most credit card issuers don’t consider a balance transfer to be “spending.”

They define spending as a “new purchase” made with their card, so you are often not rewarded for a balance transfer.

1.5% Cash Rebate on Any Balance Transfer

Then I stumbled upon a unique balance transfer offer that does give you rewards simply for transferring a balance.

It comes courtesy of the Delta Community Credit Union Visa Platinum Rewards Credit Card, which offers 1.5% cash back on any balance transfer you initiate within 90 days of account opening.

So for example, if you transferred $5,000 to this credit card, you’d get $75 in cash back rewards. That $75 would be deposited into your savings account. It’s not clear if said savings account has to be with Delta Community FCU.

It also takes two billing cycles for the bonus to post to your account, so you can’t just transfer the money and pay it off immediately, or transfer it elsewhere until two complete cycles have passed.

Here’s the Catch…

Now that all sounds pretty great, right? A balance transfer that pays you instead of the other way around.

By the way, this offer has no annual fee and no balance transfer fee, which makes it even sweeter. They  normally charge a $3 cash advance fee it appears, even though it’s a balance transfer.

Anyway, the big catch is that this cash back balance transfer has a variable rate of 10-14% APR. So in reality it’s probably not a good credit card to transfer a balance to.

You’ll pay a much higher rate of interest versus most other balance transfer credit cards that tend to offer 0% APR for some period of time, usually a year. Or life of balance offers that can be as low as 6%.

In other words, the rewards are no good if you have to effectively pay to get them. You’re probably better off just going with a no fee balance transfer or an even a balance transfer you have to pay that has a rate of 0% for 12 months or longer.

The moral of the story here is don’t be fooled by promotions that do more harm than good. The purpose of a balance transfer is to pay off debt, not get rewarded. So keep your eyes on the prize and avoid gimmicks like this.

Update: I found a cash back balance transfer with 0% APR!