What Are the Highest Credit Limit Balance Transfer Credit Cards? – Forbes Advisor

Credit cards are notorious for—some might even say synonymous with—high interest rates. Oftentimes, that reputation is deserved. For example, the Federal Reserve reports that the average credit card interest rate in August 2022 was 18.43% (interest-assessing accounts).

If you’re struggling with credit card debt, a balance transfer credit card could be an effective way to address the problem. But consumers with large amounts of credit card debt may need to find card issuers that offer high credit limits to take advantage of this debt payoff strategy.

Read on for more details about how to find the highest credit limit balance transfer credit cards available. But know a high credit limit is never guaranteed—so you’ll also find tips on what you can do if you’re unable to qualify for a card with a credit limit large enough to meet your needs.

How Much Debt Can You Transfer With a Balance Transfer?

Many card issuers will allow you to use your full credit card limit for balance transfers. However, most balance transfers also involve a balance transfer fee. So, you will need to leave room for that extra expense when moving debt to your new account.

Imagine a credit card issuer approves you for a new account with a $20,000 credit limit. For the sake of simplicity, we’ll also assume that the card issuer allows full credit limit access for both balance transfers and purchases and charges a 5% fee for balance transfers.

If you have a full $20,000 worth of credit card debt on other accounts (or more), you wouldn’t be able to transfer that entire amount to your new account. Because the card issuer in this hypothetical scenario charges a 5% balance transfer fee, the maximum amount you’d be able to transfer would be a little over $19,000 (assuming a $0 starting balance).

The example above assumes that the card issuer will let you use your full credit limit for balance transfers. However, some credit card issuers may cap how much you can transfer even if your credit limit is theoretically high enough. For instance, if a card issuer approves you for a $10,000 credit limit but sets a lower balance transfer limit of $7,500, that restriction would have a big impact on how effectively you could use the account for debt consolidation purposes.

Additionally, some card issuers have policies restricting balance transfers. If you open a Chase credit card, for example, you won’t be able to transfer more than $15,000 within a 30-day period when initiating the balance transfer request online or over the phone with a customer service representative.

How to Transfer a Large Credit Card Balance

The first step of any balance transfer is to figure out which credit card is the right fit for you. If you know that you want to transfer a large amount of debt—whether one lump sum from an existing high-limit card or smaller amounts from multiple cards—you’ll need to look for balance transfer cards with the following features:

• Low APR or 0% APR balance transfer promotions
• Potential for high credit limits
• Low balance transfer fees (if available)

The average credit card limit, for general-purpose credit cards, was about $8,000 per account in 2020, according to a report from the Consumer Financial Protection Bureau (a government body meant to protect consumers and educate Americans on financial matters).

There are many factors that determine what credit limit a card issuer may offer you. However, if you’re hoping to transfer a large amount of credit card debt, here are some of the best balance credit cards to consider:

How To Get Approved for a High Credit Limit Balance Transfer Card

Once you have a list of credit cards that you think meet the criteria you’re looking for, it’s important to examine whether you’re likely to qualify for those accounts. First, you will want to take a look at the condition of your credit to see where you stand.

A card issuer is almost certain to check at least one of your credit reports and an associated credit score when you apply for a new balance transfer credit card. So, it’s smart to request your own credit reports from Equifax, Experian and TransUnion before you fill out any credit card applications.

You may also want to look over your credit score to get an idea of your overall credit health. There are a variety of credit scoring models, but lenders will typically use your FICO Score when deciding whether to extend you credit. In fact, FICO says that 90% of top lenders use the company’s scores to assess new applications for credit.

A good FICO Score doesn’t guarantee that you’ll qualify for a new credit card, but a bad or fair credit score will almost certainly exclude you from getting approved for a balance transfer card. Therefore, it’s helpful to know your credit information up front so you can work to improve your credit in advance if necessary.

Alternatives to Balance Transfers

Balance transfers can be helpful for many consumers, but they may not be the right solution for every person who’s trying to pay down credit card debt. If you can’t qualify for a high enough credit limit on a new credit card to transfer your existing balances, you might want to look at other options. Likewise, if you have a bad credit score due to high credit card utilization or other credit score factors, qualifying for a new balance transfer card of any kind could be a challenge.

Below are some alternatives to consider if you don’t think a balance transfer credit card makes sense for you.

Personal Loan

A personal loan is another financing option you can use to consolidate credit card debt. You won’t be able to get a 0% promotional interest rate—which many balance transfer cards offer—with a personal loan. Yet you still might be able to lock in a lower APR than you’re paying on your existing credit card accounts.

And, as another positive factor, paying off credit card debt with an installment loan might reduce your revolving utilization ratio and improve your credit score.

Debt Payoff Plan

Depending on your situation, you might consider tackling your credit card debt with a DIY debt payoff plan. Strategies like the debt snowball and debt avalanche can be used with or without a debt consolidation tool like a balance transfer or personal loan.

When using the debt snowball, you first tackle your debts from the smallest balance to the largest balance. This way, as your smaller debts disappear, you get to experience some wins early on in your journey.

If you’re more interested in saving as much money as possible rather than getting some early satisfaction, consider the debt avalanche. With this method, you pay down the debt with the highest interest rate first, and then continue down the line from highest rate to lowest.

It’s important to note that these methods dictate where your extra payments should go—you’re still required to make minimum payments on all balances.

Debt Management Plan

Credit card debt can sometimes grow to an unmanageable level if left unchecked. If you’re in a situation where it’s a struggle to keep up with even the minimum payments on your accounts, you might want to consider speaking with a nonprofit credit counselor for advice.

You’ll want to avoid for-profit companies advertising debt settlement. There are many scams down this road, and even if you don’t get scammed, the strategies used by these for-profit companies can severely damage your credit score. To make sure you’re working with a legitimate nonprofit credit counseling service, a good step is to check if they’re affiliated with the National Foundation for Credit Counseling or the Financial Counseling Association of America.

A reputable credit counseling company may be able to help you set up a debt management plan (for a fee) that reduces interest rates and puts you on track to repay your credit card debt—typically over a three-to-five year period. Be aware that while you’re on the plan, you won’t be able to open new credit card accounts or take out new loans.

Bottom Line

A balance transfer credit card can be a great tool to help pay down credit card debt. But it’s important to take your time and make sure that this approach is right for you.

With the cards recommended in this article, you have a chance at getting approved for a high credit limit and being able to transfer what you owe to one new card. But if you’re approved only to find that your new credit limit isn’t high enough to accommodate your debt, or if your credit card issuer caps the amount of debt you can transfer, you’ll have to weigh your options.

You might decide to roll the dice and apply for a second balance transfer card. Or, you might apply for a personal loan to cover what remains. Finally, you might decide it’s best to simply transfer what your new card allows, then prioritize paying off what’s left on your old card as quickly as possible.