We’ve all seen no-fee credit cards offering “0% APR” on balance transfers for 6, 12, and even for the life of the transferred balance. If you have a balance on your HELOC loan, you may be able to take advantage of these offers. Here’s an example of how: last year I accepted such an offer and promptly transferred $10,000 from my HELOC loan balance (which had a 4.25% rate). Then I cut up the card!

For the next eleven months, I paid the monthly minimum credit card payment (3% of the outstanding balance) by writing a check from my HELOC loan account. In the twelfth month, prior to the expiration of the 0% offer, I paid off the remaining balance with another HELOC loan check. During the 12 months, I also made sure to continue my regular payment towards the HELOC loan at the same level, meaning that more of each payment went to pay down principal and less went to interest. Net result: interest savings of over $350.00, lower principal balance on my HELOC loan, and a positive addition to my credit repayment history!

You should be aware that the minimum monthly payment on credit cards is typically 2% of the outstanding balance. This means that the (all principal) monthly payment on a 0% credit card may be higher than payments on a similar-sized HELOC, especially if the HELOC only required interest payments be made. Before using this strategy, you will have to plan for the higher payment amount.

For a current list of 0% credit card balance transfer offers,click here.