by 
The Curious Bag
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A balance transfer occurs when you transfer the debt you have accrued on one credit card to another credit card. A balance transfer does not directly affect your credit rating. The new credit account, however, does.
Facts
You will have to open a new account to transfer your balance. This increases the ratio of your available credit limits compared to what you owe and can boost your credit score.
Considerations
When you apply for new credit, the credit card company will check your credit score to see if you qualify for the card. This will result in your score dropping slightly for a short period of time.
Time Frame
A balance transfer may take up to two weeks to go through. You must continue to make payments to your original credit card provider during this time to avoid a late payment notation damaging your credit score.
Amount
The amount you owe to your creditors accounts for 30 percent of your credit score. If a low introductory rate offered by a balance transfer helps you pay down your debt faster, your credit score will improve.
Warning
Canceling a credit card following a balance transfer may lower your available credit limit and may also damage the length of your credit history. This will cause your credit score to drop.
Source:
MyFICO.com: What's In Your FICO Score?
Brian Fore; Capital One, Mclean, Virginia
More Information:
The Federal Reserve Board: Choosing a Credit Card
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