Usually by doing Paying your mortgage with a credit card is a bad idea. IN one exception, however, this is when you are chasing a bonus to a new card, because there is a scenario where this maybe pay offthis is how it works.
When to use a credit card to pay your mortgage
Most bonus cards offer spending bonuses that cost anywhere near $ 1.200 in cash in the form of points or miles. These bonuses are usually based on targeted spending for the first few weeks or months after receiving a new card. Let’s take a typical example: Capital One Venture Reward Card offers a reward of $ 1,020, provided you use a $ 3,000 card. purchases within the first three months from the date of receipt of the card.
Since mortgage payments are often the largest recurring expense you are going to pay anyway, why not use plastic? While you pay with your card immediately, you can rest assured that you are eligible for the bonus.
However, there is one catch – most mortgage providers do not directly accept credit card payments, so you need a third-party service to do this.
How to pay your mortgage with a credit card
Currently, The only financial service that will allow you to pay off your mortgage with a credit card is a company called Plastiq… They act as an intermediary, withdrawing money from your card and then sending a check or payment through ACH to the mortgage provider. Unfortunately, there is a 2.85% fee on every payment. This means you pay $ 28.50 for your $ 1,000 mortgage payment.
Taking a Capital One card as an example, you can qualify for 1 dollar,Registration bonus 200 when accrued $ 3,000 per card, with additional 2.85% transaction fees on top (if you take a mortgage payment)… If you had two separate $ 1 mortgage payments,500, the total transaction cost is $ 85.50. As a service charge, there is nothing to it. However, it is well worth it if it helps you qualify for the remaining $ 1,114.
On the other hand, transaction fees don’t work when you’re just chasing cash.back bonuses. Cash-Reverse cards often offer 2% on all purchases, but for example, you will lose money due to Plastiq’s 2.85% commission.
It is also worth repeating that credit card mortgage payments only work when you pay off the balance immediately… Chasing high interest debt bonuses isn’t worth the risk if you’re not sure what can afford to make payments.