How can I pay my student loans with a credit card?

While direct payments of student loans with credit cards are generally not allowed, there are third-party services like Plastiq that enable this, though they charge a 2.9% fee.

Using a credit card cash advance to pay student loans is an option, but it comes with high interest rates and fees, often 20% or more.

Charging student loan payments to a credit card can help accelerate rewards earnings, like earning 2 miles per $1 spent on the Capital One Venture Rewards card.

However, the fees usually outweigh the rewards value.

Federal student loan interest rates currently range from 4.5% to 7%, while the average credit card APR is nearly 17%, making credit cards a much more expensive option for paying loans.

Paying student loans with a credit card can negatively impact your credit utilization ratio, potentially hurting your credit score if the balance gets too high compared to your credit limit.

Some credit cards, like the Wells Fargo Active Cash Card, explicitly prohibit using the card to pay student loans or other types of loans, so check your card's terms.

Paying student loans with a credit card may be considered a "cash advance" by your card issuer, meaning you won't get the same grace period as regular purchases and will accrue interest immediately.

While credit card payments can temporarily pause student loan interest accrual, the high credit card interest rates will likely negate any savings in the long run.

The CARES Act passed in 2020 allowed federal student loan borrowers to pause payments interest-free, making credit card payments unnecessary during that time.

Refinancing student loans with a lower-interest personal loan or using a balance transfer credit card may be better options than directly paying loans with a credit card.

Paying student loans with a credit card can be considered a "cash advance" by your card issuer, meaning you won't get the same grace period as regular purchases and will accrue interest immediately.

Using a credit card to pay student loans can be a risky strategy that should only be considered as a last resort, as the fees and interest rates often outweigh any potential benefits.