Credit Card for Rent

Yes, its possible, and it’s one way to earn frequent flyer miles. There are pros and cons of this approach and I’ll explore why you do and at times do not want to use a credit card for rent payments or even mortgage payments. 

The concept of earning frequent flyer miles with a credit card from every day purchases is nothing new, but why would you put a rent payment on your card? The answer is simple, if it can be done and its a big ticket item such as rent or a mortgage payment, why not? If you can earn miles faster simply by putting the rent on your card, in theory, you should be able to earn a free round trip ticket every year. And since you have to pay your rent or your mortgage this makes a lot of sense. 

The problem of course is that landlords and banks don’t accept cards for rent payments and they certainly don’t accept credit cards for mortgage payments. And that is where third party financial companies come in. 

The idea is simple and you will have to pay a fee, as that is how these guys make their money. But by being the middle man, you get to pay your rent with a credit card and your landlord gets paid. You earn miles in the process and for a small fee, but does it make sense?

Let’s do the math and find out. I reviewed the company plastiq.com and on their home page, they claim they charge a 2.5% fee for each transaction. In this example, let’s assume your rent is $3,000 a month. At 2.5% you would end up paying $75 each month in fees. Over the course of one year, you would have paid $900 in fees which is a whole lot more expensive than an economy class ticket to most destinations. In fact, if you were to use miles to purchase the ticket, most airlines would charge you a fee to claim a free ticket. While the fee would be nominal, let’s assume $49, its still a fee and certainly adds up. Your $300 ticket has now become $949 in costs, fees and your time. 

If you can find a landlord or bank willing to accept a card for rent, there is value in renting and using your card to make the payment but its not a popular concept as the landlord or bank would end up eating the credit card fees and most would not want to do that. I certainly wouldn’t. So your only option is to find a third party solution that allows payments with fees low enough to make this worth your while .

Here is a lost of options available for US based renters. Plastiq was the cheapest of all the services but again before you consider doing this, you have to weigh the time involved plus the fees as they do add up. 

Options to Pay Your Rent or Mortgage with a Credit Card:

CompanyFeesCards Accepted
PlastiqDebit: 1%Credit: 2.5% (occasional promotions)American Express, Discover, Mastercard, Visa, JCP, Diners Club, pre-paid and gift cards
RadpadDebit: $4.95 for payments under $5,000/$9.95 for payments over $5,000Credit: 2.99%American Express, Discover, Mastercard, Visa, Apple Pay
RentshareACH payments: $1.95Credit or debit: 2.99%American Express, Discover, Mastercard, Visa
RentMoolaDebit: $3.99Credit: 2.99%American Express, Mastercard, Visa
VenmoDebit: FreeCredit: 3% Discover, Mastercard, Visa

Now, if you need to top off your frequent flyer account with miles and you are shy of a free ticket or upgrade, making one or two rent payments with a card can make sense. Just keep in mind that I do not use this method as a means to earn miles and tickets as I find it does not make financial sense. 

A Word of Caution

Besides not earning a higher value from the points you earn compared to the fee you pay, there are a couple of things to keep in mind when considering paying your rent or bills through any of these third party providers. First, make sure they don’t mark the purchase as cash advance charges. These purchases earn no rewards and worse, have high interest rates. While these providers claim to all be set up to ensure your purchase does not show up as cash advance, you should always call your credit card issuer and request the cash advance fee be lowered as close to $0 as possible before completing a payment. Otherwise, you are completely defeating the purpose of paying for rent with a card

Also, there is the length of time it can take payments to be completed. For example, the provider could mail a physical check to your bank or landlord, and you want to understand when it will happen to avoid any chance of rent being paid late. You want to ensure you have confirmation payment was received.