Can You Pay a Mortgage With a Credit Card?

Q: Is it actually possible pay my mortgage with a credit card? I’ve heard that it can be done with certain mortgage companies but don’t know where to turn to find our more.

A: Well first of all, you know I’ve got to ask… are you looking to pay a mortgage with a credit card for purposes of convenience or leveraging this big monthly spending obligation in order to earn lots of reward points, miles or cash back? Or are you essentially borrowing the money with a credit card because you don’t have the funds on hand to make your payment?

If it’s the latter scenario, then this “how to” advice isn’t for you, as that would be an unfortunate case of kicking the can down the road (and if you haven’t seen this movie before, it doesn’t end well). If circumstances don’t allow you to service your mortgage I would recommend speaking to a financial planner, attorney or mortgage loan originator to explore options (i.e. loan modification, foreclosure, short sale, etc.). Simply saddling your credit card issuer with the payment, even for one month, thinking you’ll catch up later is not the answer.

However, if you simply want to explore the options of paying your mortgage with a credit card in order to leverage such a large monthly spend category to earn cash back, reward points or miles, then bravo – keep reading!

For starters, it’s important to point out that the real estate bubble and subsequent crash in the past decade literally changed everything. During the ’00’s there were all kinds of crafty ways to pay mortgages. However, after the crash the housing finance world dramatically changed, largely because some banks got burned on one or both fronts since many bank holding companies have both mortgage lending and credit card divisions. During the crash both of these critical lines of business suffered huge losses due to customer defaults. Not to mention that capitalism itself almost collapsed during that turbulent period, but that’s too big of a topic to tackle here.

What options exist in 2016?

There is a third-party service called ChargeSmart that will let you pay using a credit card. The fees to do so are just a bit over 2.5% last I checked. However, that’s going to more than offset any potential benefit from earned rewards.

Chargesmart screenshot

Meanwhile if it’s a rent payment you need to make, then check out WilliamPaid…

WilliamPaid screenshot

WilliamPaid is free if using a bank account, but if you use a credit card the fee was 2.95% the last time I checked. A good option for those in apartments.

With either service, make sure you use the right card! If you need to pay this money back over time, don’t get ripped off with 15% or 20% interest from your bank. Instead consider one of these cards which give 0% on purchases.

All the options below no longer work

American Express mortgage payment?

Back at the peak of the bubble in 2007, American Express cardholders could pay any prime level mortgage from American Home Mortgage for a one-time fee of $395. If you paid you always paid your credit card bills on time and in-full, this option definitely made sense considering the high cash back offered on the AmEx Blue Cash.

However as of 2015, the option to pay a mortgage with American Express no longer appears to be available.

Bank of America card mortgage payment?

The other company which offered options (abeit indirectly) for paying a mortgage using a credit card was Bank of America. All FIA issued cards (which is a wholly-owned BofA subsidiary) offered the ability to pay bills for free using your credit card. Although this option specifically created for mortgages, many would use this service to pay mortgages with credit cards from Bank of America. Sounds like a cool trick until you hear that no points or rewards were given on FIA bill payments… so there really wasn’t any point in using it for your mortgage.

Back in 2010 the FIA Bill Pay Choice was canceled.

Any way to still pay and earn points?

Unfortunately, not at this time. Some have brought up the idea of using Paypal to get money to pay their mortgage, but that will always be a losing proposition… even the best cash reward credit cards won’t make up the 3% in fees that Paypal charges. That being said, it still could be a strategy to do it, if you’re using it because you need financing (and therefore, rewards aren’t a priority).

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Why couldn’t you purchase pin-enabled Visa gift cards with your credit card from a grocery store, then purchase your money order with the Visa gift card(s)?

Those are considered debit cards and should work. I believe most have a $4.95 charge, so you would be paying $504.95 for a $500 card. A $1,000 mortgage payment would cost you the $9.90 (1%) and the money order fee, which is usually less than $1.00 from places like Wal-Mart, Kroger & Meijer.

Has anyone used Charge Smart site? They do not have the best reviews so wanted to see if anyone had input on here.

Most mortgages include an escrow account to pay your property taxes and homeowner’s insurance. First I checked my property taxes and found out they charge an additional 3% to process you taxes with a credit card. But, almost all insurance companies will accept a credit card payment for free. So, you have to let the insurance company know that you will be paying the homeowners policy yourself. It might be the smallest part of your mortgage but it’s still as few hundred dollars going towards a reward.

Use the balance transfer feature to pay for mortgage. Some card do not charge fee for balance do not get points, but you get the float and also it can boost your crcredit. So long as you pay that cc balance off I full every month to avoid interest.

Okay! I think I got it! You use the credit card to buy supermarket gift cards. You then use the supermarket gift cards to buy a money order from the super market.

Using your credit card to earn rewards is the dumbest idea ever. It only helps credit card companies. The more you use the card to earn your so called rewards, the more interest you pay on the credit card balance. And I know some people pay off their balances every month, which in that case would work, but what are the chances of that always happening.

That is not true. I pay some of my bills cable, cell etc….. on my credit card to receive miles, I also send payment from my banks bill pay to pay that exact amount off on my credit cards the next day. If you pay a balance off on your credit card before the billing cycle there is no interest charged.

Please. The only reason why lenders do not allow you to pay with a credit card is simply because people have figured out ways to pay off a 30 year fixed mortgage in 5 years, and I’m one of them. The amount of interest you would be saving is so tremendous that it doesn’t benefit the lenders. It only benefits you, but hey, it doesn’t matter how many times you outsmart the lenders, eventually they will make sure whatever method you come up with will not be allowed.

Hi did you pay off your 30 year fixed mortgage in 5 years? do you care to share? thanks.

Can you explain me how

I suppose you could get as many 1 year 0% introductory rate credit cards as possible and pay a huge chunk off of your mortgage (avoiding the credit card interest for a while). After 1 year you could refinance the house and start again, right?

Say you get $50,000 in interest free credit cards for 1 year and put $50,000 in principle on them. You would save ~$12,000 in mortgage interest during the year. Then you refinance, and roll the cost of the new loan ~$3,000 and the $50,000 in credit card debt into the new loan.

Of course, if the housing market goes down and you cannot refinance you would be totally screwed. Still not a 5-year plan though

Could you explain to me how this would be done, and is it still do able..

It’s actually free to pay rent with a credit card, at least up to 1500 a month or 3000 for couples.

You cannot buy a money order with a cc.
Smart charge charges 20.00

If I average my rewards it would cost me 1000.00 (to charge smart in order to purchase a 325.00 round trip ticket in continental us) through my cc rewards program

Why cant you buy a money order with a credit card? I have bought money orders at the USPS with my Visa bank card…. what is the difference?

perhaps your VISA bank card might be a debit card? debit cards = cash you have… credit card = cash you borrow

If you can’t find a way to pay the mortgage with a c.c., then be creative, you can definitely use it for everything else in your budget;
and whatever else that you have that you regularly pay for.

What about Amex Serve? You can fund your account from a Credit Card (for free, and you do get CC rewards) and use their bill pay to pay anyone! Watch out though – some CC view this as a ‘cash advance’ and will charge the fees…so far Chase and Barclay do not for me.

Hi Justin…We just got the Carnival Cruise card from Barclay, and have rentals that we would like to put all the mortgages on the card for points. Thanks for the info, will check into this!! Debbie

Ok, I haven’t looked into it too much, but Amex looks like it’s for American Express. How do I go about using my Chase and Barclay cards? Thanks for the info!

Cash advance fees for credit card loads may apply; please check with your credit card issuer for details.

What about using pageonce? They charge, I believe 30 cents to pay anything with a credit card.

I found the following on the Pageonce Terms of Service. Basically, they monitor your payments (i.e. can’t use credit card to pay mortgage) otherwise they cancel your account.

You acknowledge that certain Payees may not accept payment from all types of funding sources and that we may otherwise limit the payment methods available for a particular Payee. For example, you may not be permitted to use a credit card to make a mortgage payment. Additionally, we may, at our discretion, impose limits on the number and amount of payments, in aggregate, that you can send using the Bill Payment Service. In no event will any user be permitted to use the Bill Payment Service to make payments to Payees of more than $10,000 per calendar month in aggregate.

This is what I found on the Chase Sapphire website terms and conditions of earning promotional points, “You do not earn points on balance transfers, cash advances, cash-like charges such as travelers checks, foreign currency, and money orders, any checks that are used to access your account, overdraft advances, interest, unauthorized or fraudulent charges, or fees of any kind, including fees for products that protect or insure the balances of your account. “

Thanks mo for that totally obvious and useless information. At least it didn’t pertain to the discussion in any way. Good job, thanks for the input! ! !

It actually does help. They suggest taking a cash advance from your credit card to pay the mortgage and therefore earn points. “Moe” points out for Chase Sapphire, this won’t work.

Charge Smart charges $22.95 for up to $1300 mortgage payment. If $1300 or over, they charge incrementally ~$5 for $1500, ~24 for $2000, etc.

I like how this article’s header on Google is “How to pay a mortgage with a credit card for free,” and then proceeds to tell you it’s impossible.

Thanks, you jerk.

Sorry about that Jack, I was in the process of updating with the current options. Previously it was possible to do it for free thru BofA.

Although you may have fixed the body of the page, the title of the page is still wrong, which is throwing off google search.

how about that new Apple Square? what if i charge myself equal to my mortgage payment on my rewards card then take that money back out of the Square account and pay my mortgage. Then, obviously, pay my rewards card.
…i just looked it up, its a 2.7% charge per swipe :-/
will this even pay itself back in rewards?

A cashiers check or money order, is backed by cash and guaranteed by the bank that issues it. To purchase with a credit card, a bank would cash advance your card and use the cash to purchase the cashiers check / money order. This requires a 3-5% fee on the total depending on your card agreement. The amount goes into the cash advance category which accrues interest daily (no grace period) at the highest rate. Also rewards are not available for this for any card. Lastly the sale of a Monetary Instrument requires reporting under the Bank Secrecy Act for amounts over $3000.00

I wonder if you can purchase a cashiers check with a credit card and then use the cashiers check for the mortgage?

The USPS will not let you use a cc to buy a money order. Most retailers will not either, I have read that some small local retailers might accept a credit card to purchase a money order but i have not found one yet.

There is a bill paying service called Charge Smart that for a fee will let you use your credit card to pay a mortgage, auto or student loan or even an utility bill. How it works: The company acts as a middleman, accepting payment from your credit or debit card and then arranging a funds transfer to pay your bill. But it charges a fee of as much as $9.95, in the case of a car payment.

Thanks for the heads up Fred. I checked it out and it looks like in addition to the fee, there is also a percentage fee on the amount of a few percent.

The cash advance does not count towards points, so withdrawing [a cash advance] from you credit card would not create a benefit. Also, for money orders, you have to pay with cash… they will not let you use a credit card for money orders.

I can’t imagine the money order thing working because of two reasons. The first being that whomever you purchase the money order thru will charge you a fee. How much of a fee, I do not know. The second being that your CC issuer will view this as a cash advance and charge you the appropriate rate. I’ll have to read my agreement but I can’t imagine them doing that for free. Perhaps if I were to pay my full bill monthly, which I do, I would avoid fees.

i dont think you can buy Money orders with CC.. i was thinking if you can withdraw money from the CC for points?

No you cannot get points on a cash advance

That is an awesome Idea about purchasing a money order, did this work?

of course not. what’s so awesome about it? Even if your proprietor allows you to use a credit card to buy a money order, many credit cards charge a significant fee for cash advances, such as money orders. They also may waive rewards for such transactions. It sounds like a lose lose proposition.

I’ve been trying and trying to think of a way to do this, yes to capitalize on a rewards card since we’re paying so much money toward the mortgage each month. Someone suggested using your credit card to purchase a money order each month, and then using the money order to make your mortgage payment. But I don’t know if you can buy a money order with a credit card. And if you can, perhaps that would be excluded from rewards on credit cards. Do you know the answer?