If you are renting a home in the US for 45 million, your monthly rent is probably one of your biggest expenses. What if you can pay rent with a credit card? Paying with plastic may give you weeks to pay your bills and may even help you get rewards.
Some owners or rental companies make payments easy through online portals, while others require third-party services or some sort of solution. If your landlord is an option, remember that there may be expensive expenses and disadvantages. Below, we explain all the different ways you can use credit cards, how they work and fees.
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How to pay rent with a credit card
Usually, if you are willing to skip enough basketball, you can pay your rent with a credit card, although that doesn’t mean you should. Paying rent directly from your bank account is safer and cheaper to pay for checks or ACH transfers.
Financial experts warn that if you are confident that you pay off your full balance before the expiration date, you can only rent on your credit card. Otherwise, you can easily increase credit card debt and high interest expenses.
Like any decision, make sure that the benefits outweigh the risks.
☑️ Directly through the landlord
Some landlords and rental companies can let you pay rent using an online portal or through a credit card through tools like Square. There are usually additional fees that the landlord may pass to you during the transaction.
For example, the square fee is between 2.6% (plus 10 cents) and 3.5% (plus 15 cents) of processing fees depending on whether the transaction is completed in person, online or manually entered.
If your landlord accepts rent through PayPal and you want to pay with a credit card, you will pay at least 2.99% of the rent. You can also pay rent through Venmo if your landlord allows you, but you will charge a 3% fee.
Rent paid directly to landlords through the online payment portal is usually counted as a “buy” and 0% APR introductory for credit card rewards, although your credit card issuer may have different regulations.
While credit cards do not specifically list rentals as an exclusion purchase for the sake of rewards, please call your card issuer to ensure the payment count for points. Even so, processing fees usually exceed any rewards you receive in the transaction unless you are able to meet the minimum spending requirement for receiving a welcome bonus.
☑️With third-party payment service
You can use a service called Plastiq to pay rent with a credit card without the cooperation of the landlord. Before charging the card, you can enter the landlord’s payment address and information. From there, your landlord can pay by ACH transfer or by mailing paper checks.
Plastiq charges a 2.9% payment fee, which will pay your fees upfront. Plastiq filed for Chapter 11 bankruptcy in 2023, although it is still operating and repairing customers. The website is still on the way, but the company’s future is uncertain.
Plastiq payments usually earn credit card rewards and count to the minimum spending requirement for welcome bonuses, although depending on your credit card type, you may limit the bills you can pay through the service.
☑On the landlord management platform
Some apps and websites allow you to pay rent with a credit card, but usually require the expected fees of the renter to use their services. You also have to let the landlord use them.
For example, an app called Doorloop that helps landlords collect rent payments and manage other aspects of their rental business, and allows tenants to pay with credit cards. However, the app charges tenants a 3.25% fee and pays with a credit card.
Turbotenant is another platform that offers similar services to landlords, but pays rent with a credit card of about 3.49% processing fee. Most cashback credit cards offer up to 2% refunds on daily purchases, so paying 3% with a credit card will not provide net income.
Consider a professional credit card to pay rent
A unique rewards credit card called Bilt MasterCard* allows you to earn rewards on purchases, including rent payments. Cardholders can use Bilt Mastercard to pay rent without transaction fees as long as their landlord accepts ACH payment or check.
Since most landlords give up processing fees for e-bank payments, the BILT card provides you with a route and account number to pay rent through the landlord’s online payment portal as if you were paying from a bank account.
You can also choose to send BILT mail directly to the landlord, or turn on the BILTPROTECT feature to make rent payments from the connected bank account so that “buy” does not cut your available credit.
There is no annual fee for this credit card, and cardholders can earn 1x double on rent payments (up to 100,000 points per year), qualifying travel purchases 2x points and dining 3x points. You must purchase at least five times on the card during each declaration period to receive a reward. Rewards can be redeemed for travel, merchandise, rent payments or future down payments for homes, and more.
Read more: Earn rewards on a credit card to pay rent or mortgage? Yes, please
How to know if you use a credit card rental
In an emergency, paying rent with a credit card can be particularly convenient when you are financially behind and want to avoid late fees from your landlords. Credit card companies usually give you a grace period, and then you have to pay the bill and start generating interest.
However, before using a credit card to pay rent, make a plan to fully pay the balance on the stated balance due date. If you don’t, then any rewards you earn will be immediately eliminated by the huge interest charge. Most credit cards offer about 2% cash back when they purchase, but the average credit card APR is about 20%. Apart from that, consider the potential impact on your overall finances.
Credit Score: Using a credit card to make regular purchases and pay on time is a great way to build credit. However, putting huge fees like rent into practice can increase your credit utilization, or increase the likelihood of missing payments or taking on balances, which can hurt your score. If you want to build credit, services like Experian Boost allow you to report rent to the credit bureau Experaian without having to put payment on your credit card.
Credit limit: Your ability to charge rent from a credit card may depend on your credit limit. Even if you have the space to pay rent easily, charging a large amount of rental payments will increase your credit utilization, which is the percentage of credit you are currently using that is related to the total available. High credit utilization may damage your credit score.
Transaction fees: Even if your landlord allows payments on direct rentals on credit, you will almost always pay extra, making your rent more expensive. These fees may be more than you think: $2,000 rent payment is 3%, up to $60 per month, and a fee of $720 per year.
award: If you are getting a generous welcome bonus for the minimum spending requirement, it makes sense to pay rent for a few months with a credit card. However, when it comes to ongoing rewards on most regular rewards credit cards, the extra fee you pay with a credit card is almost always more than the value of the reward you will earn. If you want to pay rent with a credit card without any fees, check out BILT Mastercard.
*All information about BILT Mastercard is collected independently by CNET and has not been reviewed by the issuer.
