Rejection is never fun. But it’s even worse when your finances are involved. Those who’ve been refused a balance transfer don’t need to give up hope, though.
Here’s what to do if your balance transfer is refused.
Consider Applying for Another Balance Transfer
Balance transfers can be a great way for people to consolidate debt on their own. Just because you’re not approved for a balance transfer the first time doesn’t mean you should give up hope on it.
Transferring a credit card balance is an effective way to consolidate debt for a couple reasons. First, it focuses on one of the most pernicious forms of debt—credit cards. These come with high interest rates and the balances can get really out of control. Probably the best feature about credit card balance transfers is they come with an introductory low-rate period. Right now, many companies are offering zero percent interest for 18 months on balance transfers.
This is a wonderful deal because having so much time without accumulating interest can allow consumers time to pay down their debt. If you think this will seriously help you get out of debt, understand the reasons why your balance transfer wasn’t accepted by the lender. There are a few reasons why your transfer might be rejected:
- Your credit score might be too low. Most lenders want people with pretty good credit. Look for ways to raise your score before trying again.
- You already have several balance transfers on your record. Lenders are going to see this as a sign you’ve tried and failed with balance transfers in the past, which is unlikely to inspire confidence in them.
- Your credit limits don’t match up. If you’re trying to transfer more than the credit limit on the new account, you’re not going to be able to complete it. Consider coming back with a new proposal for transferring a lower dollar amount.
- You didn’t complete the balance transfer in the allotted time frame. There’s a certain window for going through with a balance transfer after your application is accepted, which closes if you wait too long.
- You’re trying to transfer funds from the same lender. Most credit card companies won’t let you transfer funds from one account to another.
Don’t get too discouraged if you run into one of these problems. Communicating with lenders can help resolve confusion a lot of the time.
Look Into Debt Consolidation Loans
If it looks like the balance transfer isn’t going to happen, it’s time to start considering other paths. A debt consolidation loan is another approach that can lower your interest rates. Those looking to try debt consolidation will likely want to work alongside a debt relief agency.
Like with a balance transfer, a consolidated loan takes a variety of credit lines and combines them into a single new loan. Many people will find paying off one account as opposed to many automatically makes getting out of debt easier. Most often, working with a debt relief agency to get a consolidated loan will lower your net interest rate as well.
It’s just important to take some time to compare debt relief agencies before deciding on a program. Not all are of an equal quality, so choosing the right or wrong one can make a big difference. Freedom Debt Relief has a solid reputation for being a reliable source for debt relief services.
Think About Other Forms of Consolidation
It’s possible another type of debt consolidation will work out for you if neither of these options seem right. There are a few other ways you can do this, such as borrowing from a life insurance policy or retirement plan.
The clear drawback of drawing down one of these accounts is there won’t be as much in there later on when you potentially need it. At the same time, this can still be preferable if you’re currently in a tough spot with your debt.
It’s possible your credit card balance transfer won’t be accepted. Don’t fret too much if this is the case. There are still other options that can work for you.