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Hi, Martha
I don't remember if I've ever posted this strategy elsewhere, so I'll explain it here.
First, it didn't start off this easy. Our debt situation was significant and it started from a circumstance over which we had no control. Suffice it to say that we had reasonably good credit but were faced with debt we couldn't pay off in one month or even one year. That was over 15 years ago, and some foolish decisions in the meanwhile made it an up and down situation.
In the beginning, I would take advantage of any lower rate I could get with a balance transfer, and I didn't care how often I had to transfer it. I wasn't aware at the time that this would actually hurt my credit score, though not much. This was some time ago, and often I would get offers to let me transfer with no fee. The lower rate would last perhaps 3 to 6 months.
After a while, I was getting so many that I could be picky about the length of the offer, and started to read the fine print. Eventually, about 8 or 9 years ago, they were mostly for 0%, and for up to a year. That's when it got easy. Because I'd only have to transfer once or twice a year and I was making significantly more than the minimum payment, the credit scores went up and with them the number of offers.
I went into that detail for the sake of people who aren't getting 0% offers, but are getting offers for lower rates. It's a process--begin now and you may be out of debt before you start getting 0% offers. The key is to make the biggest payments you can rather than the minimums.
Most of the time I now get offers with no transfer fees. But even if it has a transfer fee, if the other terms are favorable, like a low minimum payment or a long-term initial rate, I may take it if the time is right. If the time isn't right, I may read only a few of them to get a feel for the current offer climate, as this relates to my business.
If there is a transfer fee, it usually amounts to 3% or less of the transferred amount. That's no longer a significant number, and though it's a small step back, it's worth it in the long run to get a 0% rate for a year.
I had to do the math to determine that at first. Just figure the difference between a low rate (like 4-8%) for a year's interest, and a 3% one-time transfer fee. I'm a little obsessive :-), so I'll actually do a spreadsheet and calculate the interest month by month based on a declining balance due to payments. If it pencils, I do it.
Now I'm a much more sophisticated debt eliminator. The first rule is don't incur it if you don't have to. There's a 'what-if' calculator with the money management tool I use. With it I can plug the proposed new debt into the existing plan and see how much longer (total) I'll be in debt if I get this new purchase. I use it to decide whether the new purchase is that important to me. Most of the time it isn't.
If I understood your last paragraph correctly, I'd say you're on the right track with that strategy.
Hope this helped--sorry it was so long.
Cheri
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