If you transfer a credit card balance to another credit card, you should consider how keeping or canceling the original credit card will impact your credit score. Transferring a balance does not automatically hurt your credit, but canceling a card might.
In the past, if you had too many lines of credit open, you may have appeared to be "overextended." Today, however, credit scores can be adversely impacted by closing old accounts. As an example, if you have a $10,000 line of credit on an old credit card plus a total of $5,000 in additional lines of credit and your total current credit card debt is $5,000, you are using about one-third of your available credit ($5,000 debt divided by $15,000 credit line). When you cancel the $10,000 line of credit, you are using 100% of your line of credit ($5,000 debt divided by $5,000 credit line), which will lower your credit score because the ratio of credit used to credit available should be 50% or less. Your credit score will also be negatively impacted if the length of your credit history is shortened by closing a credit card account that you've held for a long time.
Of course, the new credit card with the lower interest rate may bring you an additional line of credit, but it may not be at the same high level as the original card. Also, be aware that transferring a balance to another card can cost you money in balance transfer fees (e.g., 3% of the amount transferred to the new credit card).
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