The content is accurate at the time of publication and is subject to change.
The other day I was talking about credit card rewards with a friend – as I tend to do, since I write about them day in and day out – and as we marveled over how many free flights he’s been able to get by using his American Express card for all his small business expenses, he said, “if only I could pay my mortgage with my credit card – can you imagine? I’d get so many miles!”
He was laughing, but I was thinking, “why not?” Why can’t you pay your mortgage with a credit card? Or maybe , just maybe . . . you can. I decided to investigate. After all, there are entire sites dedicated to “travel hacking” – the practice of searching for the best deals and steals to increase your mileage rewards to get as many free or cheap flights as possible. There must be something out there about using your mortgage payment to fatten up your rewards balance.
A quick Google search of “pay mortgage with credit card” pops up about 47,900 results. The top result is a blog post called “Pay Mortgage With Credit Card? Here's How to Do It“ by Creditcards.org (one of Credit-Land.com’s competitors) and the next one is “How To Pay Mortgage With Credit Card For Free” by CreditCardForum.com (another competing site). The rest are similar, even less credible-looking sites, so I didn’t bother clicking on too many of them.
I read the articles and checked out their claims for myself. Here’s what I found:
Most lenders won’t allow you to pay your mortgage with your credit card.
No matter what credit card you use, they just won’t let you do it. The Creditcards.org article (from 2011) talks about amortgage lender called Ditech that gives borrowers the option of paying with a credit card, even offering rewards for doing so. Sweet! Maybe a little too sweet – they went out of business in 2008. Also, they were known to specialize in subprime lending and predatory lending practices – a search of “Ditech” and “evil” will net you some interesting results.
There are a couple of other cards that used to advertise themselves as cards to pay your mortgage with – a couple of Fidelity cards, a Schwab card, even an American Express card – but they either no longer exist or no longer allow mortgage payments.
Almost all the programs that used to advertise paying your mortgage with a credit card have been phased out.
There was once a program called CardIt, which allowed customers to pay their mortgage with a credit card. Their $19.95 plus 2.49% fee per transaction would have more than wiped out any rewards that came from paying with a credit card, anyway, they seem to have folded soon after coming on the scene in 2007. American Express’s program that lets certain mortgage lender’s customers charge their mortgages, for a $395 enrollment fee at closing, has also evaporated into the ether.
ONE company that will let you pay your mortgage with a credit card!
ChargeSmart.com appears to be the one company that gives people the option of making their mortgage payment with a credit card. They charge a transaction fee of $4.95 plus 2.29% of your payment – making a mortgage payment of $2,000 effectively cost $2,050.75. Do that every month for a year, and that’s $609 in fees. Let’s say you have an amazing rewards credit card that gives you 2% cash back on your mortgage payment. For that $2,000 mortgage, you’d earn $40 back per month, or $480 per year. $480 in rewards next to $609 in fees doesn’t make much sense, does it? Besides that, ChargeSmart doesn’t even accept American Express, the company that’s known for having the highest rewards for the biggest spenders, so if you’re looking to earn frequent flyer miles or other great Amex perks, you’re out of luck.
So it seems that paying your mortgage with a credit card and reaping rewards from it is, alas, not a viable option. Really, it’s for the best. Mortgages have a built-in system to guarantee timely repayment, while credit cards do not. If you put your mortgage payments on a credit card and then get behind on them for some reason, you could find yourself in a world of hurt – one that no amount of frequent flyer miles, points, or cash back could redeem you from.