A balance transfer allows you to move the entire outstanding balance of one or more credit cards to a new credit card, often with a low or 0% promotional APR for a set period of time. Most credit cards will charge a balance transfer fee to accomplish this (which is typically 2% – 3%). If you are able to secure a 0% APR and pay off the balance within the promotional time period, a balance transfer can be a great way to consolidate debt. However, if you aren’t able to pay off the balance transfer within the promotional time period, your credit card APR will usually return to the double digits, and you’re back at square one. Additionally, you may not be able to transfer all of your debt onto the card with the promotional APR if the credit limit is too low or there is a restriction on what percentage of the credit limit can be used for balance transfers. A credit card debt consolidation loan will have a fixed interest rate and repayment period, and your monthly payment will never change. Rather than a six or 12-month period to repay a balance transfer, you’ll have an agreed upon amount of time to repay the debt consolidation loan, usually one to seven years. You also won’t need to worry about your interest rate doubling or even tripling since there’s no promotional time period like a balance transfer.