If you're responsible, using credit cards to pay bills is a great way to build reward points and miles. Some people even make their rent or mortgage payment with one, then pay it off every month. If your landlord or lender allows this, make sure to ask about potential fees so you don't get blindsided.
Most mortgage lenders tack on a processing fee to payments made with credit cards that you may not know about before you set up the payment. That means if the fee is 2% and your card only gives you 1.5% cash back, for example, you're losing money every month.
Also, ask how the credit card transaction is processed. If the lender processes credit card payments as a cash advance, it will start accruing interest as soon as it clears, before you have time to pay it off and reap the rewards. This could get expensive quickly as cash advances typically carry a higher interest rate than any other credit transactions. Of course, if you're harvesting other rewards, like airline miles or reward points, the math may work in your favor. Either way, ask the questions up-front to avoid potential fee shockers.
Can You Pay Your Mortgage With a Credit Card? | Money Talk News
Photo by Got Credit.
No comments:
Post a Comment