The Ultimate Guide to Credit Cards
Thursday, September 24, 2020

#1 Way to Consolidate Credit Cards Onto One Card

Consolidate Credit Cards Onto One Card

credit card advice

Adam West
By: Adam West
Updated: April 14, 2020
Advertiser Disclosure

American consumers have taken on a growing amount of credit card debt in the years since the Great Recession. Many who see this trend as unsustainable are looking to consolidate credit cards onto one card in an effort to reduce the total debt they carry, not to mention the amount they pay each year in interest.

A recent study found consumers have an average of four credit cards with a combined balance of nearly $6,200, which costs an average of $1,162 annually in interest. If you’re one of the millions of consumers with a mountain of debt spread across multiple cards, consolidating that debt into a single payment probably sounds pretty good.

Among the ways to consolidate credit card debt are using balance transfer credit cards and debt consolidation loans. However, of your available choices, the easiest and most effective way is to transfer your card balances to a single card with a low or even 0% interest rate.

Balance Transfer Cards | Loan Consolidation | FAQs

A Balance Transfer is the Best Way to Consolidate Debt

It may seem counterintuitive but getting another credit card might be the best way to pay off credit card debt. Of course, it must be the right card, one that’s specifically designed for transferring the balances from other high-interest credit cards.

Balance transfer credit cards usually have an introductory interest rate period, many at 0% APR, that lasts for as long as 18 months. Here are our selections for the best balance transfer cards to consolidate credit card debt.

Discover it® Balance Transfer

This card is currently not available.

0% Balance Transfer Rating



Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed

The Discover it® Balance Transfer card isn’t so much a card itself, but rather a feature added to some of Discover’s most popular reward cards. With this feature, you can choose among cash back, travel, or other reward cards, and take advantage of an enticing introductory APR offer for new cardholders on balance transfers and purchases.

It’s a great way to pay down other card balances and still end up with a desirable rewards card. An introductory balance transfer fee will apply initially, followed by another fee for future transfers.




  • Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
  • Earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year.
  • Earn unlimited 1.5% cash back on all other purchases.
  • Earn 5% on travel purchased through Chase, 3% on dining at restaurants and drugstores, and 1.5% on all other purchases.
  • No annual fee.
  • 0% Intro APR for 15 months from account opening on purchases, then a variable APR of 14.99 - 23.74%.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR on Purchases 15 months
14.99% - 23.74% Variable

The Chase Freedom Unlimited® card combines some premium features that make it not just a great balance transfer card, but a great all-around rewards card. First is the introductory 0% rate on both balance transfers and purchases. Next is the unlimited 1.5% cash back on every purchase.

And, finally, is a signup bonus for meeting a minimum spending requirement within the first three months. There’s no annual fee for the Chase Freedom Unlimited® card, however, a 3% balance transfer fee applies for transfers within the first 60 days, increasing to a 5% fee after that.




  • One-time $150 cash bonus after you spend $500 on purchases within 3 months from account opening
  • Earn unlimited 1.5% cash back on every purchase, every day
  • No rotating categories or sign-ups needed to earn cash rewards; plus, cash back won't expire for the life of the account and there's no limit to how much you can earn
  • 0% intro APR on purchases for 15 months; 15.49%-25.49% variable APR after that
  • Pay no annual fee or foreign transaction fees
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% for 15 months
15.49% - 25.49% (Variable)
Excellent, Good

The Capital One® Quicksilver® Cash Rewards Credit Card is one of the best combination cards out there for balance transfers, cash back rewards, and a nice signup bonus. This unique card offers an intro 0% rate on balance transfers and purchases with a flat balance transfer rate of 3% for the entire introductory rate period.

You can transfer a balance at any time during the initial promotional period and get the 0% rate. Plus you’ll earn 1.5% cash back on all purchases, and a potential cash reward bonus for meeting a minimum spending requirement in the first three months. All this, and it comes with no annual fee. Of course, you do need good to excellent credit to qualify for the Capital One® Quicksilver® card.

You May Find a Card without a Balance Transfer Fee from a Credit Union

In addition to the cards on this list, many credit unions offer balance transfer credit cards with 0% introductory rates, some of which charge no balance transfer fee. Other credit union balance transfer cards have fixed low interest rates designed for longer-term debt consolidation.

If you’re not a member already, you can check this credit union locator for the ones that serve your community.

Consolidating with a Loan is the Next Best Option

If you have too much debt to fit on a single card or if your credit score doesn’t let you qualify for a good balance transfer offer, your next best option may be a debt consolidation loan. Debt consolidation loans have the advantage of offering a fixed APR that is usually less than what a standard credit card charges.

Getting a loan to pay off high-interest credit card debt can help several ways, including reducing your monthly payments, helping you pay down debt faster, and improving your credit score by lowering your overall credit utilization rate. Here are some types of debt consolidation loans you may want to consider.

Home Equity Loans

A home equity loan lets you borrow money against the value of your home, that is assuming your home is worth more than what you owe on any mortgage you have. Of course, using a home equity loan for debt consolidation has both positive and negative aspects  — some of them obvious, and others that you may not have considered.

Among the advantages of a home equity loan over a personal loan are a generally lower APR, a longer repayment period, and the potential tax deduction that can further lower the effective rate you pay. LendingTree is one such provider of home equity loans that we recommend.

  • Find lenders for new home purchases, refinancing, home equity loans, and reverse mortgages
  • Lenders compete for your business
  • Offers in minutes
  • Receive up to 5 loan offers and select the right one for you
  • Founded in 1996
  • Over $250 billion in closed loan transactions
Overall Rating

On the surface, the advantages of a home equity loan may seem overwhelmingly positive, but let’s consider why they deserve a little more scrutiny.

Having more time to repay debt — in the case of a home equity loan, as much as five to 30 years — can add a lot to the total cumulative interest you pay. Be sure you don’t end up paying more interest in the long run.

For example, if you can pay off your credit card debt in two years vs. transferring it to a five-year home equity loan, the added interest cost may not be worth it.

Now for the primary and obvious disadvantage of this type of loan — the risk of losing your home if you default. Because your home is collateral for a home equity loan, failure to repay can result in forfeiture of the asset.

By comparison, defaulting on credit card debt is bad, but won’t result in you being homeless.

Personal Loans

Getting a personal loan to consolidate debt on multiple credit cards is an option to consider. But the APR on this type of loan can vary greatly depending on the lender. The rate you’ll pay is also directly tied to your credit score, the type of lender you choose, and the length of the loan.

Personal loans, also called signature loans, require no collateral. Because of this, interest rates on these loans can vary widely.

The following lending networks may approve you for a loan large enough to pay off your credit card debt at a lower interest rate than what you’re currently being charged.

  • Loans from $500 to $10,000
  • All credit types accepted
  • Receive a loan decision in minutes
  • Get funds directly to your bank account
  • Use the loan for any purpose
Overall Rating
  • Loan amounts range from $500 to $5,000
  • Experienced provider established in 1998
  • Compare quotes from a network of lenders
  • Flexible credit requirements
  • Easy online application & 5-minute approval
  • Funding in as few as 24 hours
Overall Rating
  • Loan amounts range from $500 to $35,000
  • All credit types welcome to apply
  • Lending partners in all 50 states
  • Loans can be used for anything
  • Fast online approval
  • Funding in as few as 24 hours
Overall Rating

Banks and credit unions tend to offer the lowest rates, but they also have the strictest loan qualification requirements. Online lenders and lender networks offer a wider variety of loans for different credit types but may charge higher interest rates.

According to the Federal Reserve Bank of St. Louis, the average finance rate for a 24-month personal loan at a commercial bank is just over 10%. That compares with an average credit card interest rate in the U.S. north of 15%. So, providing you have good to excellent credit, a personal loan can save you quite a bit in interest charges.

But what if your credit isn’t among the top tier? How much can you expect to pay for a personal loan if you have to look outside the traditional bank lending environment?

Avg Loan APRs

Online lenders can charge rates of up to 35.99% for those with bad credit, but the average APR you can expect will likely be near or slightly less than that of a credit card.

401(k) Loans

If you currently participate in a 401(k) employer-sponsored retirement plan, you may be able to borrow from your account to consolidate and pay off debt. However, just because this is an option, doesn’t mean it’s the best choice for a loan.

Pros and Cons of 401k Loans


If you make the decision to borrow from your 401(k), you must be aware of the plan’s many rules and restrictions. Borrowing even a small amount from your 401(k) can greatly reduce what you’ll have available for use in retirement.

First, the amount you are legally able to borrow can’t exceed 50% of your total vested account, up to a maximum of $50,000. Also, the loan must be repaid through payroll deductions over a maximum of five years.

There are also restrictions and caveats that involve eligibility, such as if you leave your job or want to transfer your 401(k) to an IRA. This can mean you must repay the loan in full or pay an early withdrawal penalty.

The argument in favor of taking out a 401(k) loan is that the interest rate is often very low. The interest rate calculation varies by plan administrator but tends to be something just above the Prime Rate.

Also, whatever interest you pay goes directly back into your account, helping to offset some of the compound gains you’re losing by withdrawing funds.

Can I Consolidate Credit Card Debt onto One Card?

If you’re carrying a balance on multiple credit cards, it’s a good bet you’re paying more in interest than you need to. You can save a bundle by transferring those balances onto a single card with a low or even zero interest rate.

But can you really consolidate all of that debt onto a single card? In a word, yes.

Credit card offers with 0% interest rates on balance transfers are designed to help you consolidate debt from multiple cards. However, you need to ask some questions when deciding whether to go this route:

  1. How much total debt will I be consolidating, and will the credit limit of the new card cover it? Depending on factors like your credit utilization ratio, credit score, and the number of cards you have, the credit limit you receive may not allow you to transfer all of your debt to the new card. In this case, choose the balances with the highest interest rates to consolidate first.
  2. How long is the introductory rate period? Most 0% introductory offers are good for at least 12 months, and some extend as long as 21 months. Be sure you know the terms of the card you’re applying for. Also, pay attention to the rate you will pay after the intro period, as some of them charge a very high standard APR.
  3. Is there a balance transfer fee, and how will it impact what I pay? Most balance transfer cards charge a one-time 3% fee to transfer a balance. That means $30 for every $1,000 you transfer. Be sure to include this fee when calculating whether this is the right choice for you.

Consolidating the balance from multiple credit cards onto a single card can be a good financial choice, as long as it’s done the right way. Be sure you can pay off the transferred balance within the introductory rate period.

Also, carefully consider the details of the card you plan to get and shop around for the longest intro-rate period and lowest balance transfer fees you can find.

Is Consolidating Credit Card Debt Bad for Your Credit?

Taking charge of your financial life by consolidating credit card debt is seldom a bad thing. But the method you use can have a big impact on your credit score.

One way your score can take a hit depends on what you do after being approved for a balance transfer card. When you consolidate existing credit card debt onto a new balance transfer card, don’t cancel your old credit cards.

Doing so can have the effect of driving up your credit utilization rate, which accounts for 30% of your FICO score. This rate is calculated by dividing your overall credit card balance by the available credit you have. Closing your old cards will lower your available credit.Example of Balance Transfer Impact to Utilization Rate

Another way your credit score could potentially be hurt involves an unintended consequence of debt consolidation. If you transfer high-interest balances to a new low-interest card, it may feel like a fresh start.

All of those cards that now have a zero balance may start begging to be used… don’t do it! Debt consolidation only works if it’s part of a plan to curb spending and actually pay down the amount you owe.

The benefits to your credit score when consolidating credit card debt the right way far outweigh any potential harm. By paying off cards, reducing your overall debt, and actively monitoring your spending, you’ll likely find your credit score increasing rather than dropping.

What is the Smartest Way to Consolidate Debt?

At the risk of sounding simplistic, the smartest way to consolidate credit card or any debt is the way that works best for you.

For some, that could mean getting a balance transfer card with a high enough credit limit and a long introductory rate period. For others, a debt consolidation loan might be the best choice. Whichever route you decide is best, having a plan and executing it is crucial.

Consider the amount you owe, the amount you’re paying in interest on what you owe, and the amount you can pay each month toward the balance of what you owe. Any choice you make for a credit card or loan to consolidate your debt should be based on these three factors.

Remember that consolidating and beginning to pay down your debt is just the first step — you also need to take control of your spending. It makes no sense to reduce your debt at the same time you are taking on more. Make a budget and stick to it.

Debt consolidation, whether done with a balance transfer credit card, a low-interest personal loan, a home equity or other type of loan, should be seen as a means to an end. The ultimate goal is to reduce your debt and the amount you’re paying in interest.

Prepare for What’s Next

American consumers have taken on an increasing amount of debt in the years following the economic recovery. However, consumer debt can’t continue to grow unrestrained.

For those who see credit card debt as an unnecessary drain on their hard-earned resources, consider paying off debt by consolidating onto a single low-interest credit card or loan. It’s one of the best ways to ensure you’re prepared for whatever the economy brings.

Advertiser Disclosure is a free online resource that offers valuable content and comparison services to users. To keep this resource 100% free, we receive compensation from many of the offers listed on the site. Along with key review factors, this compensation may impact how and where products appear across the site (including, for example, the order in which they appear). does not include the entire universe of available offers. Editorial opinions expressed on the site are strictly our own and are not provided, endorsed, or approved by advertisers.