Comments on: Should You Pay Your Mortgage With a Credit Card?

By: MAL

MAL — Thu, 30 Apr 2009 03:12:30 +0000

The idea is that if you can get rewards (cash) for paying a bill you’d be paying anyways, (via debit) then why not? The downside seems to be on the mortgage lender. They don’t want to pay visa or mastercard 1-3% per transaction and essentially lose their profit margin.

It’s not about having a low income or worrying about a quick buck. It’s free money if you can get it. I make 300$ a year with cashback rewards on my visa for paying regular monthly bills. Adding a large mortgage payment on top of that at 2% back would be amazing.

However this strategy will never work. Mortgage lenders would get screwed.

By: owner

owner — Sun, 24 Feb 2008 01:06:38 +0000

this is a plan for losers. pay your dam mortgage and be done with it. dont try to be cute this is what got most people in the subprime mortgage mess we’re in.
How low are we going to go, perhaps if your performance at work increased you would get a promotion and not have to worry about how to get a quick buck from your REWARDS card.

By: Barton

Barton — Sat, 02 Feb 2008 02:26:38 +0000

Just locked this in today…Bank makes the money on the $395 fee for first year and hope to gain more of your business after that. Amex gets a smaller cut than normal transactions but it is HIGH volume of cash and with the underwriting they keep it extremely low risk. If you are financially sound enough to qualify, savvy about rewards points (ie…..realize how fast you’ll pass the $6,500 floor on Blue Cash and start getting 5% on many purchases) this is a no brainer. The fees and rates are competitive and they also have a $300 rate match guarantee. If you can pay each month and rates happen to be at a rate where you would refi anyway, than why not? I just locked 15-year at 5.000%.

By: Rewards Ninja

Rewards Ninja — Sun, 25 Nov 2007 22:44:46 +0000

Phillip,

I saw your post and checked out your website. Great concept, but at $19.95 per payment plus 2.5% of mortgage payment for the fee, I do not know of any rewards program where the consumer could come out ahead, or even have a good chance of breaking even. Get the fee down to a flat 1%, and you will likely have my business.

By: Philip Mikal

Philip Mikal — Fri, 14 Sep 2007 15:20:58 +0000

Our company, CardIt, just launched this month. We allow payment of over 100 lenders via Visa, Mastercard, or Discover.

Unlike the AmEx program, we have no enrollment fees or ongoing commitment. There is a fee to use our service, but saavy users have been able to substantially mitigate this depending on their use of rewards programs. Other users have found use for their cash that has greater value to them than the cost of making a payment with us.

I welcome direct comment and feedback. philip (at) cardit (dot) com.

By: Tom Allen

Tom Allen — Tue, 05 Jun 2007 17:25:24 +0000

This is an excellent idea but it seems to me that only a small percentage of people are able to keep control of their credit card spending.

For everyone else this could get out of control very quickly and just put them in the situation of running up more high cost debt as we all know what the interest rates on credit cards are like.

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By: Lazy Man and Money

Lazy Man and Money — Fri, 01 Jun 2007 21:05:34 +0000

I would love this, but I wonder if there is going to be some kind of catch down the line. For instance, perhaps they pull the rug out and say that they are no longer accepting the specific cards that give rewards. I’m not sure if they could legally do that after you pay for the privilege, but I could see that being the case.

Or perhaps the mortgage companies that offer it make up for it by offering worse rates.

By: Q at $1 Million to My Name

Q at $1 Million to My Name — Fri, 01 Jun 2007 20:59:04 +0000

Only if you can pay it off each and every month, and if there’s no fee associated with doing this.

Otherwise, NO!

By: dong

dong — Fri, 01 Jun 2007 19:01:30 +0000

Any company can choose not to accept payment by credit card. I still remember when it was cheaper to pay at the pump for gas by cahs. Other service providers just choose not to do that since they rather pay the transaction charge and get paid. However a 1-3% transaction chrage for mortgage company is significant. It’s the equivalent of them dropping your interest rate by that amount. They make thin margins on a large amount. The transaction charge could take away their whole margin.

By: Chris

Chris — Fri, 01 Jun 2007 17:42:21 +0000

Benefit sounds okay if you want the risk and are responsible with your cards, but a $395 fee? Ouch! Really what is different between a mortgage payment and any other bill? If they already allow other bill pay through the card, what justifies the mortgage exclusion?

By: Flexo

Flexo — Fri, 01 Jun 2007 15:55:49 +0000

I think other companies will offer similar services in the near future — if not other credit card companies (who will wait to see if they want to take on additional risk), other mortgage lenders who would be happy to set up automated payments from a credit card for a fee.

By: ntguru

ntguru — Fri, 01 Jun 2007 15:44:44 +0000

I think you missed the biggest downside–only one mortgage or two companies are accepting the Amex card for payments. So you’d either have to already be with the company or refi. Now obviously if Amex can get others on board, or find a way to allow checks to be cut with a credit card payment (for a low enough fee), that would be great news.