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Southwest balance transfer bonus offer: is the fee worth the points?

by on Sat March 17, 2012 • 44 Comments
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The Southwest Rapid Rewards credit cards sometimes offer a limited time balance transfer bonus offer. The bonus is one Southwest Rapid Rewards point per dollar of balance transfers into your new Southwest Rapid Rewards credit card.

The catch…

  • You pay a 3% cash fee on the amount of the balance transfer
  • You are limited to a $10,000 total transfer with the Southwest Rapid Rewards Plus credit card and $15,000 with the Southwest Rapid Rewards Premier credit card
  • You must initiate the balance transfer within 90 days of receiving the Southwest credit card

But the biggest thing to be aware of…

Southwest Rapid Rewards points are capped out at a value of $1.44 per 100 points. That’s because each $100 in Southwest airfare requires 70 Rapid Rewards points for the best value ‘Wanna Get Away’ fares.

So, by doing the balance transfer you are paying $3 per $100 to earn points worth $1.44.

Let’s use some numbers to make it easier.

  • Let’s say you make a $10,000 balance transfer. That will cost you $300 (3%), and you will earn 10,000 points.
  • 10,000 points (divided by 70) is worth $144 toward a Wanna Get Away Fare per Southwest’s rules.
  • So, you’re actually losing money on this deal. That doesn’t count the amount of interest you will have to pay if you don’t pay off the credit card balance within the first month.

In general we discourage carrying a month to month balance on mile credit cards.

If you’re carrying a credit card balance month to month, you will be better off moving your balances using a standard 0% APR balance transfer.

Even then make sure you do the math to make sure it saves you more than the standard 3% transfer fee. Paying down outright is always the best option.

Once your balances are off, start using mile credit cards for your ongoing expenses, and have fun earning points with them.

When you’re not carrying a balance, earning points worth up to $1.44 for every $100 you spend on the Southwest Rapid Rewards credit cards is not a bad deal. It’s better than the 1% cash back you earn on a lot of credit cards. You can also earn Southwest Rapid Rewards points using the Chase Sapphire Preferred® Card which offers instant 1:1 point transfer into your Southwest Rapid Rewards account.

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Chase Sapphire Preferred® Card

Miles dont expireas long as card is open
Learn more

Partner Offer

50,000 bonus points

Intro Offer

$0 introductory annual fee the first year, then $95

Annual Fee

Yes

Foreign Transaction Fee Waived

Yes - transfer to United MileagePlus, Southwest Rapid Rewards, Marriott Rewards, and more

Points Can Transfer to Airline Miles ?

Still confused? Have a question?

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"These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered."

44 thoughts on Southwest balance transfer bonus offer: is the fee worth the points?

  1. Mike

    I have the Southwest Business card and received balance transfer checks. The FAQ states that “transactions from this offer to not earn rewards or rebates.” Do you have any idea if this is referring to earning Rapid Rewards points? Meaning, no rapid rewards points would be earned if I used the checks?

    Reply
  2. Sharon Hackmeister

    I have a Chase Freedom credit card that I pay off every month. Would I still have to pay the 3% charge to transfer this month’s balance to my new Southwest card?

    Reply
    1. MileCards.com

      @Sharon – Unfortunately you can’t transfer a balance from one Chase card to another. You can only transfer in from other banks.

      Reply
  3. Parker

    I racked up $17k on my chase southwest card and will not be making any additional purchases on it. I’m looking to pay off the card asap and a, considering switching to another card. Does the Chase Southwest card charge a transfer fee? What would you reccomend?

    Thanks in advance!

    Reply
    1. MileCards.com

      @Parker – The transfer fee gets charged by the card you’re transferring *to*. If your credit is strong, the Barclaycard Ring has 0% for 15 months with no fee for the transfer.

      Reply
      1. Parker

        Thanks! If I transfer to another card will I lose my Southwest points that I’ve accumulated?

        Also, what are your thoughts on the Chase slate card ? It looks like the perfect fit for what I am looking for..

        Reply
        1. MileCards.com

          @Parker – Your points stay regardless of your credit card activity. Slate wouldn’t work because you can’t transfer from one Chase card to another Chase card. But Ring is almost identical.

          Reply
  4. Brian Herring

    JUST AN UPDATE ON THIS PROMO- This $0 transfer is great if you aren’t going to use the card anymore but if you continue to use the card at all after a balance transfer the charges will be categorized and charged like a cash advance… that means you are paying IMMEDIATE interest on any and all charges while the transferred balance sits at 0%. BUYER BEWARE….

    Reply
  5. Rosie

    If I use a travel card for a trip to get the points (but it has no 0% intro apr), will I still be able to redeem the points if I transfer the balance from that purchase to another credit card that has 0% apr?

    Reply
    1. MileCards.com

      @Rosie – Yes, once you make a purchase the points are earned even if you pay it all off right away.

      Reply
  6. Andrea

    I was approved for rapid rewards and booked a flight. I am interested in transferring a low balance from another credit card to this one and then canceling the other card. I don’t really fly all that much (maybe twice a year) would this be beneficial for me to do?

    Reply
    1. MileCards.com

      @Andrea – Wouldn’t recommend that. You’ll then be stuck paying interest on all the new purchases you make on the Rapid Rewards card until the whole balance you transfer is paid off. Instead, better to open another card with zero or low interest separately and transfer the balance there. Keep your old card open if it has no annual fee – so your credit utilization remains healthy. And only use the Rapid Rewards card for purchases you can pay off at the end of each month. The points aren’t worth paying extra interest charges.

      Reply
  7. Mical

    I have a balance of under $500.00 and am looking for a SWA miles card or one that plays well with SWA. Any recommendations?

    Reply
  8. Stacey

    I’ve had my card for 2 months and it has an 1,800 balance. I’m thinking of balance transferring that amount to a card that is not chase. If I do this and clear my SW card, will I get the 50,000 pts? I’ve paid 1,800 out of pocket so I’m almost there. Would it be better to just pay the 200.00 to ensure I get the pts and then transfer the rest?

    Reply
    1. MileCards.com

      @Stacey – Doesn’t matter whether you transfer it away or not. As long as you’ve made the charges on your card, you’ve made spending toward the threshold.

      Reply
  9. Delaware meeting room

    Tax law about businesses in the USA is ever changing.
    Further, amount of loan must be need-based, subject to ceiling
    of Rs 25,000 per borrower for purchase of machinery or equipment etc,
    and meeting working capital requirement of one operating
    cycle. What you give away doesn’t have to be
    costly, but it must be valuable.

    Reply
  10. Cindy

    I’m curious if you know whether you lose any/all your points if you transfer balances to another card that is not the Chase Southwest or if they can work with you on their APR. I’ve been paying insane APR on this card because I got into a little financial rut ($30k single income for family for three years) and unfortunately racked up debt on this card. I need to significantly drop my interest, but I’m afraid of losing all my points that I’ve received here. Any help would be appreciated. Thanks!

    Reply
  11. john

    Transfers for up to 15,000 points permitted during the first 90 days. I will incur the maximum $99 transfer fee for transferring $15,000 but worth it since I will pay off the balance in full and pocket the 15,000 points.

    The offers must vary as I have a 5% transfer fee up to $99. fyi, I called Chase Bank tonight to confirm on these and the rep. said that she’d never heard of the right to transfer for points. I found the email from Chase with this benefit clearly highlighted.

    Not worth it if you are not going to pay off the transferred balance in full right away.

    Reply
  12. Lauren

    I am making a large purchase and would like to receive the points but putting it on my Southwest card; however the APR is kind of killer and I would like to transfer it to a 0% card. Will I still receive the points?

    Reply
    1. MileCards.com

      @Lauren – Yes, if you make the purchase with the Southwest card, then pay it off you’ll still receive the points for the purchase.

      Reply
  13. Lauren

    I am making a large purchase and would like to receive the points; however, if I do a balance transfer from the Southwest card to a 0% card, do I still receive the points?

    Reply
  14. G2gclothingline@gmail.com

    If I open a Sw card and do a balance transfer, does it go towards the $2,000 in 3 months to receive 50,000 points offer?

    Reply
  15. David R

    Im surprised this thoroughly written article didn’t also cover the benefit of transferring a balance from a card with a higher APR than what’s offered with the Southwest card. It just might be worth making a transfer. Also, the business version doesn’t report to your personal credit report, so if you’ve been paying down a high balance on a personal card, moving that balance to the biz version of this card may also benefit you, in terms of utilization. On top of everything, you’ll also be earning a point per dollar. Might as well try to kill two or three birds with one stone.

    Reply
    1. MileCards.com

      @David R – Fair point if you don’t have an alternative with no balance transfer fee. But if you haven’t exhausted no fee balance transfer options, best to go to those first before dealing with the 3% fee.

      Reply
  16. Ashley

    When I log on to my Chase account it has a tab for transfer balance. Does this mean I will get a new card?

    Above it says I have to pay it off in the first month, with my options listed under my card it says 0% APR til 4/2017 with a 3% transfer fee or 0% APR til 3/2017 with a 2% transfer fee.

    What is the major difference between these, and again, how does the transfer take place? I’m not too worried about my milage right now, as I’d like to pay this down.

    Reply
    1. MileCards.com

      @Ashley – What you see in your account is an offer to add balances TO your Chase account. Not FROM your Chase account. Check MagnifyMoney.com for some good balance transfer deals that could help take care of your existing balance. Just make sure you look for a card that’s not from Chase, as they don’t let you transfer balances from one Chase card to another.

      Reply
  17. Stefanie

    I am very disappointed with this. I looked and did research as to when I would have to pay the annual fee and I couldn’t find anything. I got the credit card because it was -200 for the flight, and just having a baby, that would really help…and we are lucky to even be able to get to take a trip. Of course I read the small print with a 99$ fee but I couldnt seem to find when that would be applied…at the beginning, at the end of the year, etc. Well it was put on in the beginning. of course I wouldnt have gotten tge credit card if the flight was only -$100. That makes no sense. One of the supervisors said they would reverse the fee if I paid it off at the branch. Went to the chase branch, had to call again and another supervisor said no id be stuck paying everything. Waste of my time. Fraud. Yes it has perks, but with a new baby, I cant specifically say if and when I’m going to be avle to travel.

    Reply
  18. lana

    Looking to pay off personal loan of $3,500 not really interested in mileage points. Is this a good thing to do, how do I do this.

    Reply
    1. MileCards.com

      @lana – This deal isn’t good for that. You should search for a ‘no fee balance transfer’ offer. For example the Chase Slate card offers a 0% introductory balance transfer rate with no fee.

      Reply
  19. Matthew Sidran

    I am curious about doing about a $1700 balance transfer to get the 50,000 bonus points for spending $2,000 in the first 90 days.

    Is this worth doing? Does the balance transfer count for this card activation offer?

    Reply
    1. Matthew Sidran

      just to be clear the balance transfer would put me over the $2000 spending mark, but will it count towards the offer of $50,000 bonus points?

      Reply
  20. Jules

    I appreciate you taking the time to work this out. I had just Googled “SWA Visa balance transfer” to try to get the information to do this myself. It was a pleasant surprise to see the work had been done for me.

    But, as Keith indicates, YMMV. For example, my fence is falling down. I need to replace it but don’t have the cash. I will first put it on an Amex Gold charge card where I need to meet a spend to get a 75,000 pt bonus. Then, I need to pay that right away and that balance has to go somewhere. Most balance transfer offers don’t allow points, but they either have a fee or interest charges. So, then the question for me is whether the possibility of the companion pass is worth paying both a transfer fee and interest on that balance.

    Reply
    1. MileCards

      @Jules- Glad you found it. You are right, there are situations where it can make sense where we haven’t mentioned. And if you’re prudent there are lots of ways to take advantage.

      Reply
  21. Keith Champoux

    When I did a $15000 transfer onto my Chase SWA card, for whatever reason the transfer fee was capped at $99 (not that I’m complaining!) Also note that the 15000 points for the balance transfer also counted towards the Companion Pass status, which was quite a deal. So on my first statement, I received the initial 50000 points for first purchase on the card, and the 15000 points for balance transfers, which gets me pretty close to Companion Pass already.

    Reply
    1. MileCards

      @Keith – Interesting, are you sure the $99 you saw on your statement was the transfer fee and not the standard annual fee of the card?

      Reply

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