How can I pay my mortgage with a credit card?
While uncommon, it is possible to pay your mortgage directly with a credit card, but most mortgage lenders do not accept direct credit card payments.
Third-party services like Plastiq allow you to pay your mortgage with a credit card, but they typically charge a 1.3% to 3.5% fee on the transaction.
Using a credit card to pay your mortgage can help you earn rewards like cash back or points, which may offset the transaction fees.
Paying your mortgage with a credit card can also help you manage your cash flow if your paycheck arrives after the mortgage due date but before the credit card statement is due.
However, carrying a balance on your credit card to pay your mortgage will result in interest charges, which can quickly outweigh any rewards earned.
Not all credit card issuers allow mortgage payments, and some mortgage lenders may not accept payments made through third-party services.
Paying your mortgage with a credit card can negatively impact your credit utilization ratio, which is a key factor in your credit score.
Some mortgage lenders may view paying with a credit card as a cash advance, which often come with higher interest rates and fees.
Using a balance transfer credit card to pay your mortgage can be an option, but you'll need to be aware of the balance transfer fee and the promotional 0% APR period.
Prepaid Visa or Mastercard gift cards can be used to pay your mortgage through third-party services, but the fees can be even higher than using a regular credit card.
Paying your mortgage with a credit card may be considered a cash advance, which often comes with higher interest rates and fees than regular purchases.
Mortgage payments made with a credit card are generally not eligible for mortgage interest tax deductions, as they are not considered traditional mortgage payments.
Paying your mortgage with a credit card can increase your risk of late payments or even foreclosure if you're unable to pay off the balance in full each month.
Some mortgage lenders may view the use of a credit card to pay the mortgage as a sign of financial distress, which could impact your ability to refinance or obtain future loans.
Using a personal loan to pay your mortgage may be a better option than using a credit card, as the interest rates are often lower and the payments are more predictable.
Paying your mortgage with a credit card can be a useful strategy for earning rewards, but it's important to carefully consider the fees, interest charges, and potential impact on your credit score.
The average transaction fee for using a third-party service like Plastiq to pay your mortgage with a credit card is around 2.5% of the payment amount.
The most common credit card rewards programs that can be used to pay your mortgage include cash back, airline miles, and hotel points.
Paying your mortgage with a credit card may be a good option for short-term cash flow management, but it's generally not recommended as a long-term strategy due to the potential for interest charges and fees.
Homeowners should carefully weigh the potential benefits of earning rewards against the costs and risks before deciding to pay their mortgage with a credit card.