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Balance Transfer Impact On FICO Score

Wednesday, July 31, 2013 - 7:17 PM
From Q/A:

This example did not fully reveal the full impact of Balance Transfer (BT).  When I applied for the NFCU credit card to take advantage of their no-fee 0% BT: I was hit by (1) hard inquiry (pull) for application, (2) second hard inquiry for credit line increase, and (3) increase in debt-to-credit (credit utilization) ratio from $19K of the $20K credit line.  It was a significant reduction in my FICO score, which should recover after the one-year 0% offer expires and is paid off.

Thus, in general, one will suffer in FICO in taking advantage of the 0% BT (even without transaction fee) in terms of hard inquiry and debit-to-credit ratio.  There is no free lunch in this world, evrything is a trade-off. 
51hh51hh1,476 posts since
Jan 16, 2010
Rep Points: 6,427
1. Wednesday, July 31, 2013 - 7:42 PM
Good info. Thanks Rhett.
ShorebreakShorebreak2,677 posts since
Apr 6, 2010
Rep Points: 14,533