Credit card balance-transfer offers are arriving less and less in credit card user mailboxes. The major credit card issuers, including Bank of America, Barclays, JPMorgan Chase, and many others, are wheeling back on balance-transfer offers.

Credit card balance-transfer allows credit card users to transfer their outstanding balance to another credit card issuer by paying a transfer fee, which is usually around 3%.  In return, the user gets a temporary 0% interest rate, which can last up to two years.

Why the Retreat

Out of the 50 million Americans who filed for unemployment benefits in the past 15 weeks, twenty million of them continue receiving unemployment benefits, which means that the economy is not recovering as fast as labor experts expected.

Credit card issuers are afraid that users might use balance transfers to redress their financial struggles. During the 2008 financial crisis, many credit card companies continued mailing balance-transfer offers.  Many credit card users signed and transferred outstanding balances that they could no longer afford to make minimum payments on. As a result, the credit card companies lost billions of dollars because most users defaulted on their loans.   The credit card industry does not want to repeat its 2008 mistake.

Do the Credit Card Companies Get Rid Of Balance Transfers All Together?

No! Credit card balance transfer is still available, but the product is exclusive to customers with excellent credit scores. If you have a FICO score of 750 and above, you can always take advantage of balance transfers.  They can be a great product when used the right way.

The credit company usually charges the consumer about 3% to move their balance from an old card to a new one.  If you transfer $10,000, your fee will be $300.00.  You can save thousands of dollars in interest payments over time as long as you don’t continue using the card or fail to pay off the balance before the introductory period ends.