Think Twice About Using Your Credit Card to Pay Your Rent or Mortgage
If you’re responsible, using credit cards to pay bills is a great way to accumulate bonus points and miles. Some people even use it to pay their rent or mortgage and then pay it every month. If your landlord or lender allows this, be sure to ask about possible fees so you don’t get confused.
Most mortgage lenders charge a fee to process payments made with credit cards that you might not have known about before setting up your payment. This means that if the commission is 2% and your card only returns 1.5%, for example, you lose money every month.
Also ask how the credit card transaction is processed. If a lender treats your credit card payments as a cash advance, they will start charging interest as soon as it is paid off, before you can pay it off and receive your reward. This can quickly become expensive as cash advances usually carry a higher interest rate than any other lending transaction. Of course, if you are collecting other rewards such as miles or bonus points, the math may work in your favor. In any case, ask questions in advance to avoid potential shocks.
Can I pay for my mortgage with a credit card? | Money Talk News