If you pay rent, you may have wondered: ‘Can you pay rent with a credit card?’ Perhaps you want to take advantage of earning credit card rewards on your rent payment, which is one of most people’s largest budget items. Or maybe you need extra time to pay off your rent over a few months. While you can pay rent with a credit card, it’s not always easy, and it’s rarely free.
Read on to learn the pros and cons of paying rent with a credit card, as well as how to do it.
Related: How to buy a house without a realtor
Image Credit: DepositPhotos.com.
Can You Pay Rent With a Credit Card?
It is possible to pay your rent with a credit card. Doing so may take a few extra steps, though.
Most — but not all — landlords do not accept credit cards as a form of payment due to credit card fees. However, there are third-party services that can allow you to pay your rent with a credit card, but they will charge you a fee.
You’ll need to weigh the costs and benefits and make sure you fully understand how credit card payments work to decide if it makes sense in your situation to pay your rent with a credit card. While it could save you in a pinch, it’s not necessarily going to help you long-term, like tackling debt through credit card consolidation would, for instance.
Image Credit: Gerasimov174 / istockphoto.
How to Pay Rent With a Credit Card
If you want to pay your rent with a credit card, you can do so through your landlord’s system if they accept credit cards. If your landlord does not accept credit card payments, you’ll need to pay through a third-party system.
One option to consider if you’d like to be able to pay rent with a credit card is the Bilt Rewards Mastercard, which makes payments directly to landlords without incurring a fee. Bilt does this through a special arrangement with Mastercard and many large property management companies.
And even if you aren’t renting from one of the property management companies they’re partnered with, Bilt will actually mail the landlord a check. Either way, you won’t incur any fees on paying rent with your credit card with this option.
Image Credit: DepositPhotos.com.
Paying Through Your Landlord’s System
Some large property management companies may accept credit cards as a form of rent payment. Landlords who accept direct credit card payments have to pay merchant processing fees in order to do so, given how credit cards operate.
Due to these fees, landlords will often pass those merchant processing fees onto the renters, on top of their rent. The convenience fee for paying rent with a credit card can range from 2.5% to nearly 3% of the rent payment amount.
Image Credit: DepositPhotos.com.
Paying Through a Third-Party System
If your landlord doesn’t accept credit card payments directly, you’ll need to use a third-party system to make the payment. There are various third-party systems that will accept and process rent payments by credit card. Do your research on the options to compare the pros and cons of each.
If you pay rent through a third party system, always review your credit card statement to make sure that the amount charged was correct and that your payment went through.
Image Credit: kitzcorner // istockphoto.
Pros and Cons of Paying Rent With A Credit Card
If you’re thinking about paying your rent with a credit card, you should weigh the pros and cons to decide if it makes sense for you. Also consider your own financial situation and what type of credit card you have.
For instance, if you have a top rewards credit card, then paying rent with your card could pay off. On the other hand, if you have a secured credit card because you’ve struggled with credit in the past, you may want to consider whether putting rent on your card is a smart move.
Image Credit: Lantern Credit / SoFi.
What Happens to Your Credit When You Pay Rent With a Credit Card?
Paying rent with a credit card can affect your credit score, depending on a few factors. This includes how much your rent is, how high of a credit limit you have, and whether you pay off the balance before it is due. Depending on these factors, paying rent with a credit card could either harm or help improve your credit score.
Image Credit: cnythzi .
Will Paying Rent Through a Credit Card Affect Your Credit Score?
If your rent is a large enough percentage of your credit limit, your credit utilization ratio will increase. Your credit utilization ratio — an important credit card term to know — is how much credit you use compared to how much you have available, and it’s an important aspect of determining your credit score.
So, if your rent is more than 30% of your credit limit — the percentage recommended by experts — then putting your rent on your credit card could negatively affect your credit score. Even if your rent is less than 30% of your credit limit, if you put other charges on your card, you may easily push your credit utilization ratio above 30% in a month.
Image Credit: GCShutter.
Need a Credit Card to Pay Your Rent?
It is possible to pay rent with your credit card, but whether you should depends on how the pros and cons stack up in your financial situation. For example, if you could earn lucrative rewards that could offset the processing fee you’ll incur, and you won’t drive up your credit utilization, it could be worth considering. Just make sure you can pay off your balance before putting your rent on your credit card — otherwise, you’ll end up paying interest on top of your steep rent.
If you want to pay your rent with a credit card, but are looking for a new one, compare credit card offers. We make it easy to see what options you might qualify for based on your credit.
*To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. A hard credit pull, which may impact your credit score, is required if you apply for a SoFi product after being pre-qualified.Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website on credit
Lantern by SoFi:
This Lantern website is owned by SoFi Lending Corp., a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license number 6054612; NMLS number 1121636. (www.nmlsconsumeraccess.org)
All rates, fees, and terms are presented without guarantee and are subject to change pursuant to each provider’s discretion. There is no guarantee you will be approved or qualify for the advertised rates, fees, or terms presented. The actual terms you may receive depends on the things like benefits requested, your credit score, usage, history and other factors.
*Check your rate: To check the rates and terms you qualify for, Lantern and/or its network lenders conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender(s) you choose will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
All loan terms, including interest rate, and Annual Percentage Rate (APR), and monthly payments shown on this website are from lenders and are estimates based upon the limited information you provided and are for information purposes only. Estimated APR includes all applicable fees as required under the Truth in Lending Act. The actual loan terms you receive, including APR, will depend on the lender you select, their underwriting criteria, and your personal financial factors. The loan terms and rates presented are provided by the lenders and not by SoFi Lending Corp. or Lantern. Please review each lender’s Terms and Conditions for additional details.
Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website on credit
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Personal loan offers provided to customers on Lantern do not exceed 35.99% APR. An example of total amount paid on a personal loan of $10,000 for a term of 36 months at a rate of 10% would be equivalent to $11,616.12 over the 36 month life of the loan.
Student Loan Refinance:
Student loan refinance loans offered through Lantern are private loans and do not have the debt forgiveness or repayment options that the federal loan program offers, or that may become available, including Income Based Repayment or Income Contingent Repayment or Pay as you Earn (PAYE).
Notice: Recent legislative changes have suspended all federal student loan payments and waived interest charges on federally held loans until 08/31/22. Please carefully consider these changes before refinancing federally held loans, as in doing so you will no longer qualify for these changes or other future benefits applicable to federally held loans.
Auto Loan Refinance:
Automobile refinancing loan information presented on this Lantern website is from Caribou. Auto loan refinance information presented on this Lantern site is indicative and subject to you fulfilling the lender’s requirements, including: you must meet the lender’s credit standards, the loan amount must be at least $10,000, and the vehicle is no more than 10 years old with odometer reading of no more than 125,000 miles. Loan rates and terms as presented on this Lantern site are subject to change when you reach the lender and may depend on your creditworthiness. Additional terms and conditions may apply and all terms may vary by your state of residence.
Secured Lending Disclosure:
Terms, conditions, state restrictions, and minimum loan amounts apply. Before you apply for a secured loan, we encourage you to carefully consider whether this loan type is the right choice for you. If you can’t make your payments on a secured personal loan, you could end up losing the assets you provided for collateral. Not all applicants will qualify for larger loan amounts or most favorable loan terms. Loan approval and actual loan terms depend on the ability to meet underwriting requirements (including, but not limited to, a responsible credit history, sufficient income after monthly expenses, and availability of collateral) that will vary by lender.
Information about insurance is provided on Lantern by SoFi Life Insurance Agency, LLC. Click here to view our licenses.
Image Credit: millann.
More from MediaFeed
Image Credit: DepositPhotos.com.