How to Transfer a Home Equity Line of Credit to a 0% APR Credit Card

Many credit cards offer zero-percent APR through a promotional period.

A quick telephone call to your credit card company may be all you need to transfer the balance on your home equity line of credit (HELOC) to a credit card with a zero-percent interest rate. The transaction could save you hundreds or even thousands of dollars in finance charges. That makes it an excellent idea if you make all your credit card payments on time and expect to pay off the card before the interest rate adjusts.

Instructions

1. Apply for a credit card--if you don't already have one--offering a zero-percent interest rate through a promotional period. Check with your bank or credit union for cards offering such a feature, if necessary

2. Review the credit limit on your new credit card. Also review the length of the promotional period.

3. Check the balance on your HELOC by reviewing your billing statement. Or call the your lender's customer service department. Confirm that your credit card has enough available credit to support a payoff of the HELOC

4. Call your credit-card company to initiate the balance transfer. Provide the customer service representative with the full account number of the HELOC and other information as requested, such as the lender's name and address. Also answer any questions necessary to establish your identity. Get a confirmation number for the transaction and ask when the transfer will be completed. Allow sufficient time to pass, and follow up by checking both your HELOC and card statements to confirm that the transaction was successful.

Tips & Warnings

• Pay attention to balance transfer fees if you're choosing between credit cards. According to the website SmartMoney, some cards don't charge a transfer fee while others charge fees of as much as four percent of the transferred balance.

• Review all terms and conditions that apply to the balance transfer. For example, SmartMoney says missing just one payment could force the zero-percent interest rate to immediately increase to say, 18 percent. Also, leaving the balance on the card beyond the zero-percent promotional period will usually result in a much higher interest rate than you were paying on the HELOC.

References

• Smart Money: Home Equity Debt Into Credit Card Debt
• Federal Trade Commission: Choosing A Credit Card