Can I Pay My Mortgage With A Credit Card?

Using Credit Cards to Make Mortgage Payments

Yes, it is possible to make a mortgage payment with your credit card, though it involves a few steps and considerations. Here are the two primary methods to do so:

1. Convenience Checks from Credit Card Companies

Credit card companies occasionally send out convenience checks. These checks function like those from a checking account but draw against your credit limit rather than available bank funds. You can write, sign, and mail these checks to your mortgage company to cover your payment.

2. Online Bill Pay Services

Some credit card companies offer online bill pay services (e.g., MBNA). This feature allows you to specify an amount to be paid to the mortgage company, drawing from your available credit. This process operates similarly to writing a check, but electronically.

Drawbacks of These Methods

While these methods enable you to use your credit card for mortgage payments, they come with downsides:

• No Rewards: Typically, you won't earn cashback, miles, points, or other credit card rewards for these transactions. This is a significant drawback, as earning rewards is often the primary motivation for using a credit card.

Getting Around the No-Reward Issue

There was a workaround that allowed users to still receive credit card rewards, though it is no longer available:

• Charter One Gift Cards: At one time, you could purchase Charter One gift cards with a credit card. These cards functioned like ATM/debit cards and could be loaded with up to $500 each. You could buy these gift cards, withdraw cash from an ATM (paying a small fee of around $3), and then use that cash to pay your mortgage. This method allowed you to earn credit card rewards while avoiding hefty cash-advance fees.

Why the Program Ended

This loophole was eventually closed as it was widely abused. Credit card companies realized they weren't profiting from it and canceled the program. However, new opportunities and loopholes can emerge from time to time, so it's worth keeping an eye out for similar options in the future.

Using a credit card to make mortgage payments can be done, but it's essential to weigh the benefits and drawbacks carefully. Always look for new opportunities to maximize your rewards while managing your financial responsibilities effectively.

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