What is a "balance transfer" and are there costs associated with it?

What is a "balance transfer" and are there costs associated with it?

Mitchell Freedman, CPA/PFS (CEO, MFAC Financial Advisors) gives expert video advice on: How can I get a lower interest rate or APR on my current card?; What if I pay my credit card bill late?; What if my credit card is lost or stolen? and more...

When individuals have built up balances on their credit cards and they have a substantial amount of money that they have to pay, they can be enticed to transfer the balance to a lower interest card. This can be a good technique if the lower rate card is either a permanently lower interest rate, or even if it's a come on interest rate in the beginning, if the interest rate as it adjusts will adjust back to a normal market interest rate as opposed to an extraordinarily high rate. It's also possible to abuse these situations because once you have a new credit card and you've transferred the balance from your old credit card, you still have the line of credit on your old credit card, and you might be enticed to charge more than you should, and you might even get to a point where you might charge more than you're even able to responsibly handle.