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Discussion in 'Archived Threads 2001-2004' started by Drew Bethel, Jan 12, 2003.
Or if this is allowed...
I can pay my apt rent w/ a credit card, but they charge ~$20-$25 fee, which would kill any benefits I would be getting...
I can't imagine that this is allowed. When I bought my car I tried to pay some of the downpayment on a credit card they wouldn't allow that, so I find it hard to believe that a house payment could be done on a credit card. It would be pretty sweet as far as cash back goes though.
My mortgage co. (Chase Manhattan) won't allow it. I asked, and I don't carry any balances on my CCs, either.
I don't see any reason you couldn't pay with a credit card, but unless the banks take the card, you'd only be able to do it as a cash advance which is dinged for interest right away. My mortgage had a cash back option when I first signed up, but they eventually canceled the program.
Since the businesses that accept your payment by credit card are typically charged about 2% for each transaction I can't imagine a mortgage company accepting one. For every $1,000.00 of your payment the mortgage company would be charged about $20.00 by the credit card company.
The ~2% fee is how the credit card companies can reward you with air miles and bonuses even if you never pay them a dime in interest.
You might find a mortgage company that would accept a debit card, especially if it was with their bank, but then you wouldn't get the air miles.
MickeS, that's interesting you couldn't pay with a CC. My parents bought a $30K vehicle a few years ago and split the entire amount between two credit cards. They paid the cards off the next month. One was a GM card so they got the limit of $3,000 off the purchase of their next GM vehicle and the other gave cash rewards (I don't know the sum). So in essence, they got their new vehicle and and all the CC rewards without paying a penny of interest.
I guess it just depends on whether the dealership wants to pay the 2% fee or not. I would think, though, car dealerships are much more flexible than mortgage companies.
Interesting comments. Maybe you can't pay with a credit card, but you can pay with a CC check. I'm going to call Discover and ask if I get the cash back for paying with Discover cheques. The interest shouldn't matter because I won't be carrying a balance.
If you use a credit card check, you'll (most likely) get hit with a 3% transaction fee. Read the fine print on those CC checks!
Another confusion factor is that most debit cards may be processed as either a debit card or a credit card.
When you make a purchase, if you enter your PIN into a keypad, then the card is processed as a debit card and the merchant is charged much less than the ~2%.
If your debit card has a VISA logo or other credit card logo on it, and the merchant doesn't have you enter the PIN on a keypad, then the card is processed as a credit card and the merchant is charged ~2% for the transaction.
As a result of this different method of processing a debit card, some banks may give you air miles when the card is processed as a credit card (because the merchant was charged ~2%), but no air miles when it is processed as a debit card.
I don't know if there are debit cards that will give you air miles when you have it processed as a debit card rather than a credit card.
From my UAL Mileage Plus cardmember agreement: Miles are earned on net purchases only; Miles are not earned on balance transfers, convenience checks, or cash advances.
Isn't paying your mortgage with a credit card like paying a loan with a loan? Maybe that's why it's not allowed.