This inquiry explores the Linguistic Threshold Hypothesis (LTH), and particularly the following hypotheses: (1) the literacy skills transfer rate from L1 to L2 is a function of L2 oral language skill, (2) the rate of transfer from L1 to L2 increases when students cross a specified threshold(s) of L2 language oral skill, and (3) interrupted change-point regression models fit the data better than linear regression interaction models. Across literacy abilities, interrupted change-point regression models disclosed levels of L2 oral language at which transfer from L1 to L2 literacy was maximized, proposing that the relationship between L2 language and cross-linguistic transfer is not constant for the young Spanish–English bilinguals in this inquiry. Further, interrupted change-point regression models fit the data better than linear interaction models, proposing the importance of employing models that better match the theoretical assumptions underpinning the LTH.