I recently paid off a balance transfer and then this thought occurred to me. Let's say you have $3000 of debt outstanding on a credit card. The goal is not to pay interest while you work to save the $3000 to pay the debt off.

Is it possible to continue to transfer that debt around to different credit cards in order to avoid being charged any fees whatsoever?

I'm sure some people out there have some creative ideas on this.

  • 4
    If you're the sort of self-financial manager that needs to resort to such a tactic, the odds are this system will fail for you as it has for so money others. This verges on urban myth for one simple reason - people who try it are the people least likely to make it work. It requires credit discipline and savings discipline, card management, and cashflow management; in short, many of the things a lot of folks do not possess. As other posters have said - sure, it can be done - but for most folks it's the top of a slippery slope.
    – gef05
    Jan 8, 2011 at 13:10
  • Two pieces of advice on this: 1) set up some kind of auto-pay to pay the monthly bill; these things blow up on you if you're late. 2) don't save up to pay it all off at once (which is what you imply you want to do), instead, just go ahead and send that extra money in every month. There's no reason to hang on to it, and if you do, you're likely to find all sorts of reasons to not send in that giant check when the time comes.
    – Patches
    Jan 4, 2012 at 20:17

4 Answers 4


In theory, yes. In practice:

  1. Most cards charge a 3% or so fee on balance transfer.
  2. If you slip and let you balance go past "free balance transfer" time limits, you'll quickly pay more in interest than you gained from keeping free credit around.
  3. You'll need an endless supply of free transfer cards to keep shuffling it around - what if one day it so happens that none is offering it right now and your current free transfer is about to expire? Again, you'll pay a lot.
  4. Doing this (opening new accounts frequently) may hurt your credit rating, which may hurt your chance of getting new deals, which would lead to problems described above.

So it can be gamed, but the odds are not on your side :)

  • 1
    I disagree about the odds not being on your side. They are, as long as you remain disciplined about it. I've done this for years -- I used to take the money via check and put it on a savings account, back when those with no balance transfer fees were easier to find. I made about $700 like that before interest rates got too low. It is true that opening a new account dings your credit a little, but doing that once every 1 - 1 1/2 years isn't going to have much effect. The key is you MUST PAY ON TIME!! It does blow up if you don't. Setting up auto-pay is useful for that.
    – Patches
    Jan 4, 2012 at 20:11
  • +1 I've done it before too, but the balance transfer fees weren't as popular back then... glad you hit that important data point. Jan 5, 2012 at 1:59

I have done this for years and have been quite successful at it. Two reason I even need to do this - desire to pay for engagement ring and pay for 150 person wedding without using my nest-egg/savings.

You need to keep a document that details when the free APRs run out, and you need to setup automatic payments of the minimum balance from your checking account so you ensure you do not miss a payment.

You need to understand when you are going to need to make big purchases of homes/apartments/cars so that you can ensure you aren't doing this right before your credit score is being checked (Need to leave 12 months without opening new accounts before doing this).

I have been able to finance about $60,000 worth of unsecured debt paying between 3-5% interest per year. We have an unsecured credit line with Citibank that charges 14% and is capped at $10,000, and Discover Personal Loans charge around 14% as well (in pre-paid interest!).

I would say, all things considering, that this is a great deal if you don't have a secured line of credit with a low interest rate.

It is something, however, that if you aren't diligent can get away from you. From my experience I would rather pay a small amount of interest while allowing my savings and retirement to grow interest (hopefully greater than 3-5%) than pay the huge expense and start from zero. But if you miss a single payment on a 0 APR balance transfer they charge you all back interest concessions plus charge you a penalty rate.

Like many of the other posts, you need discipline to make this work.


IMO, it's a good deal. Pre-paying 3% interest is better than accruing it at 1-2% per month. The other nice thing about it is that all of your payments hit the principal.


Sure of course you can do balance transfers like this but you are way late to the party and it has gotten to be pretty challenging finding new cards to transfer balances to.

Before the current financial crisis in the US you could get enormous amounts of credit (2-5 times a person's annual income) and transfer balances to your bank account to collect interest . There were a bunch of ways to the transfer everything from direct deposit to your bank account to a balance transfer check payable to yourself to overpaying another credit card and requesting a refund. Over paying another account sets off a lot of red flags now days but other methods still work.

The financial atmosphere has changed a lot and there are very few available cards with no balance transfer fees or capped fees and the interest rates are a lot lower now so it really isn't worth doing.

  • +1 for discussing how it used to be easier, but now isn't really worth doing.
    – Alex B
    Jan 8, 2011 at 16:51

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