Is the Credit Card Balance Transfer Game Over?
I’ve started telling my readers and friends to get ready for a “triple whammy” that will change the way many Americans use their credit card accounts. We’ve all become accustomed to using balance transfer offers to bounce debt between credit card lenders in order to keep our interest rates as low as 0%. For instance, even a 3% transfer fee can save you money on a 0% interest balance transfer from a higher rate credit card. However, recent changes in the credit card industry threaten to reduce the impact — and the attractiveness — of balance transfer offers. Lenders have already throttled credit lines, especially to small business owners, in an attempt to meet federal capital requirements. In February 2010, new credit regulations require lenders to apply customer payments to the portions of their accounts with the highest interest rates. That means more banks could wind up carrying “no interest” deals longer, thus reducing their revenue related to interest charges. While this may sound
