Ultimately, a balance transfer fee can be likened to the balance transfer APR, as you’ll be charged a certain percentage of your credit card balance for accepting the offer.
The big difference is that a balance transfer fee is charged one time upfront, while balance transfer APR applies for a certain period of time, such as 12 months, or for the life of the transfer.
Let’s look at an example:
Balance transfer amount: $5,000
Balance transfer offer A: 0% APR for 12 months, 3% balance transfer fee
Balance transfer offer B: 0% APR for 18 months, 5% balance transfer fee
Assuming you transferred $5,000 via 0% APR balance transfer credit card, you’d be hit with either a $150 or $250 fee.
The big question is whether it’s worth it to you to take on an additional six months of 0% APR for $100 more.
Perhaps you’ll be able to pay off the debt in less than a year, so the extra six months would be unnecessary.
Conversely, you may need more time to pay off the debt, so accepting a higher balance transfer fee for another six months could be the ticket.
Either way, just be sure you read all the fine print and compare all the fees, especially when comparing 0% APR offers, as the fee is usually what distinguishes them.