Does a balance transfer cancel the other card?

Does a Balance Transfer Cancel the Other Card?

A common misconception surrounding credit card balance transfers is that the act of transferring a balance automatically closes the original account. This is incorrect. Transferring a balance doesn’t cancel the other card; it simply shifts the outstanding debt to a new account. Crucially, maintaining the original account and meeting its payment obligations remains essential.

While the balance transfer itself might offer a lower interest rate or a promotional period, the original card still exists and needs to be managed. Failure to diligently pay the original card as scheduled, or to handle potential fees or minimum payments, can severely impact your credit score. A negative impact on your credit score can have long-lasting consequences, affecting your ability to obtain loans, rent an apartment, and even get a job.

Think of a balance transfer as moving a parcel from one box to another, not discarding the original box. The original box (the original credit card) still needs to be handled and managed to avoid any damage or problems with the shipment. The crucial element is consistent payment on both the new account and the old, ensuring a smooth transition and maintaining positive credit standing.