How Does A Balance Transfer Actually Affect Your Credit Score?

A question about balance transfers was asked on Yahoo! Answers. The question came from a person in the process of buying a home, and he or she was worried about any effects a balance transfer might have on their credit score. The card they wanted to transfer the money from had a balance of $1,300 with a $10,500 limit and a 16% interest rate. The card they wanted to transfer to had a zero balance and a limit of $3,100 with a 0% APR promotional interest rate.

There were two answers given. The first simply stated that as long as the individual does not close the first credit card, then it should have no affect on their score.  The second answer suggested that the individual read the agreement closely to be sure that the promotional interest rate also applies to balance transfers, as this is not always the case. They also suggested finding a good mortgage broker that can help them through the home buying process.

Source: http://answers.yahoo.com/question/index?qid=20111228050351AAwwvbM

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