Using a credit card to pay your mortgage might sound like a convenient way to earn rewards and manage your cash flow. However, it's not as straightforward as swiping your card at the checkout. Most mortgage lenders won't accept credit card payments directly, due to both processing fees and the nature of credit card debt. But that doesn't mean there aren't workarounds.
There are now more ways to make it possible to use a credit card to pay your mortgage. This guide talks about what those options are and explores the pros and cons of credit card mortgage payments. It also includes potential alternatives to this method.
The pros and cons of paying your mortgage with a credit card
Before you dive into this method, it’s vital to understand the implications of using a credit card to pay your mortgage. Weighing the advantages and disadvantages will give you a good idea of what those are:
Pros
Earn points and cashback: If your credit card offers rewards, points, and/or cashback, using it for large payments like a mortgage can help you potentially earn points or cashback, depending on your card’s terms.
Cash flow: If money is tight, using a credit card to cover your mortgage payments could be a big relief, allowing you to meet your obligations on time.
Avoiding late payments: Charging your mortgage to a credit card can help prevent any late fees or penalties that you might otherwise incur.
Cons
Transaction fees: Third-party services that facilitate mortgage payments via credit card all charge fees, which might negate any rewards earned.
Interest rates: If you don't manage to pay off your credit card balance quickly, your interest charges will accumulate rapidly, making your mortgage payments even more expensive than before.
Credit score impact: Consistently making large payments with a credit card is likely to increase your credit utilization, which will, in turn, lower your credit score over time.
How to pay your mortgage with a credit card
If you decide that this method could work for you, there are a few different ways to go about it:
1. Use a third-party payment service
Platforms like Plastiq act as middlemen, charging your credit card and then sending a payment to your mortgage lender — either via check or electronic transfer. This is probably the most straightforward way to use credit to pay your mortgage. And it could be a convenient way to earn rewards. But the catch is, there’s usually a processing fee of 2% to 3% that gets tacked on, which could eliminate any benefits you’d earn in terms of rewards or cashback if your rewards aren’t high.
Additionally, some card networks or issuers may restrict this type of transaction, so this method is not always guaranteed.
2. Write a balance transfer check
Some credit cards come with balance transfer checks that you can use just like regular checks. To make a mortgage payment this way, you can write one of these checks to yourself and deposit the funds into your bank account. Then you can go-ahead and use those funds to make a payment. This can be a smart, cost-effective option if your card carries a low or 0% introductory APR on balance transfers. Just just watch out for fees —which are typically anywhere from 3% to 5% — and be sure to repay the balance before the promotional period ends.
3. Take out a cash advance
If you’re really in a tight spot, a
cash advance from your credit card could provide quick access to money you can use to cover your mortgage. Just remember that a cash advance is costly, as interest rates are higher than they would be for regular card use — plus it will start accruing right away. On top of it, you’ll likely pay an additional fee just to withdraw the cash. So consider this a method best reserved for emergencies.
If that sounds too risky, check out EarnIn’s
Cash Outtool for a more reliable and cost-effective alternative to cash advances.
4. Use a specialized credit card
While you might not be able to make a mortgage payment directly, some credit cards are geared toward homeowners and offer rewards for related spending. And these types of benefits could be worthwhile. For example,
Rocket Mortgage often has specialized card offers that give cashback on mortgage payments and when you shop at home improvement stores. While it's not the fastest solution, using these cards strategically for other home expenses can free up cash in your budget to put toward your mortgage.
FAQs
Why can't you pay your mortgage with a credit card?
In most cases, mortgage lenders don’t accept credit cards for direct payments. This is mainly due to high processing fees that lenders want to avoid. Plus, they usually do not want borrowers relying on credit for mortgage payments, which could show a lack of financial stability.
However, there are workarounds, like third-party payment platforms or balance transfers, that allow you to use your credit card indirectly. Just be prepared to pay extra fees and possibly higher interest — depending on the method.
When does it make sense to use a credit card for mortgage payments?
This strategy might make sense in a pinch — for example, if you were facing a short-term cash squeeze and wanted to avoid a late payment. But it only works if you have a clear plan to pay off the card quickly and before any high interest kicks in. Otherwise, high APRs and fees could have you owning prohibitively more in the long run.
How exactly can you use a credit card to pay your mortgage?
You could use a third-party service to charge your credit card and forward the payment to your lender on your behalf.
Some credit card companies also offer balance transfer checks, which you can write to yourself and deposit into your bank account. A cash advance is also technically an option, but it’s often the most expensive route.
For a lower-cost alternative, consider using a cash advance tool like EarnIn’s
Cash Out,
which offers a more affordable way to access funds when you need them.
Can you earn credit card rewards by paying your mortgage this way?
In theory, yes. It all depends on what sort of perks your card offers — and how much. If you’re talking about cashback, for example, you need to be sure that you’re going to earn a higher percentage in cashback compared to the cost of fees. And if interest is involved, that can complicate what you owe further. So it’s worth doing the math before taking this route.
Try EarnIn's Cash Out
For reliable alternatives that won’t risk you being pulled into a debt cycle, consider EarnIn's dedicated Cash Out
tool. It allows you to access a portion of your earned wages before payday comes, giving you the flexibility needed to manage bills without incurring
high-interest debt.
By using EarnIn, you can avoid the fees and risks associated with credit card payments, helping to ensure timely mortgage payments — and financial stability.
Please note, the material collected in this post is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances. Nor is it an endorsement of any organization or services.
This Blog was sponsored by EarnIn. While the author received compensation, the information shared is grounded in independent research and intended to provide helpful and accurate guidance to readers.
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