[Editorial note: This offer was last updated on July 13, 2016.]
Occasionally, Get Rich Slowly will feature reviews that alert you to new product offerings in which you may be interested. While we haven't covered a specific credit card offer in a while, this afternoon we're alerting you to an offer by Slate® from Chase because you can save with a $0 introductory balance transfer fee, a 0% introductory APR for 15 months on purchases and balance transfers, and a $0 annual fee.
The Slate® from Chase eliminates a major drawback
The Slate® from Chase is one of the first cards we've seen heavily promoted in a long time that allows you to transfer higher-rate balances with a $0 introductory balance transfer fee. Specifically, with the Slate® from Chase card, there is a $0 introductory fee on transfers made within 60 days of account-opening. If you transfer a balance after the first 60 days, the ongoing balance transfer fee is either $5 or 5% of the amount of each transfer, whichever is greater.
For a long period of time, fees have been assessed on balance transfers such that you incur an expense when you transfer your debt to a new credit card (often right at, or right after, the time you applied for the card). These fees are usually expressed as a percentage of the balance transferred, and today the typical balance transfer fee ranges from 3% to 5%.
So for example, the drawback with many cards is that, if you decided to transfer $5,000 from a high-interest credit card to take advantage of a promotional 0% interest rate (e.g., 0% for 18 months), you could end up paying as much as $250 right from the get-go. We think that $250 is a lot of money to pay to “start saving money,” as it were.
The best way to get rid of debt
Before we go any further, let's be clear: The best way to get rid of your credit card debt is to simply pay it down. Period. If having credit cards is what got you into debt in the first place, then you should not be applying for this or any other credit card. You should take the following advice from our post on how to get out of debt: “Stop using credit. Don't finance anything. Cut up your credit cards.” You won't help your debt situation if you keep adding to it.
However, if you are unable to pay the debt immediately AND you can refrain from adding to your debt, it's possible that the Slate® card from Chase could help since it has a $0 annual fee and an introductory APR of 0% for 15 months on purchases and balance transfers. This could give you some breathing room to pay off your balance — if you make sure to pay it off before the 15-month period ends. Otherwise, you'll find yourself back in the same situation as before (or worse if you have accrued additional debt).
Note: This card is only for those who have good or excellent credit. If you don't think you qualify, you shouldn't apply as some believe applying for a credit card may affect your credit score negatively and you most likely won't have the credit card in the end anyway.
It still pays to look around
If you are looking for a balance transfer credit card, it's worth the time to investigate other credit card offers. There may be other credit card offers like Slate® from Chase that have a $0 balance transfer fee on balances transferred. We don't currently know of any right now; so if there are, please mention them in the comments.
There are numerous stories of people who found themselves in over their heads with credit card debt (many of them by personal finance bloggers such as J.D. himself), but it is possible — and even advantageous sometimes — to use a credit card without going into debt.
Have you been successful using a balance transfer credit card to get out debt? Have you tried to use a balance transfer card to manage your debt, only to make the situation worse? Share your thoughts below.