How to Pay Rent With a Credit Card
You can pay rent with a credit card, but it probably won’t be easy or cheap. Many landlords do not accept credit card payments directly, forcing renters to rely on third-party apps that charge fees in order to pay rent with a credit card. Plenty of people still do it, though. Paying rent with a credit card can help keep a roof over your heard if you’re short on cash. It also provides the benefits of fraud protection and rewards.
Below, you can find out the different methods for paying rent with a credit card. You’ll also find a discussion of the pros and cons of doing so, so you can make an informed decision on whether to pay by card or use an alternative payment method.
How Can You Pay Rent With a Credit Card?
It may be possible to pay rent directly with a credit card, just as you would other types of bills. Check with your property manager or landlord to see if they accept credit card payments. Unfortunately, many property managers and landlords do not. Plus, those who do will typically charge extra for the privilege. Any time they accept a credit card payment for rent, they are charged a processing fee of 2.5% to 2.9% by the credit card company, according to Experian. So on the average American’s rent of around $1,200, that would cost you between $30 and $35 extra per month. If you’re lucky, you might not have the processing fee passed off onto you, but don’t count on it.
If your landlord or property manager does not normally take credit card payments, you can always try to convince them by arranging to pay for your rent a couple of months in advance or reminding them of how many would-be late payments they’ll avoid. This would result in a win-win situation for both parties. However, be sure find out if they would tack on a processing fee to your normal rent charge.
If your property manager or landlord refuses to accept credit card payments or if their system is too expensive, there are still other ways to pay with plastic. We’ve broken them into two categories: those involving third-party apps and others that don’t.
|Name||Fees Charged||How It Works||Does Your Landlord Need To Be Onboard?|
|RadPad||2.99%||RadPad accepts your credit card payment, and delivers a check to your landlord for you.||No|
|RentPayment||2.95% or free (landlord has the choice to cover the fee for you)||RentPayment requires both you and the landlord to have accounts with them. They accept your credit card payment and transfer it as a direct deposit into the landlord’s linked bank account.||Yes|
|PlacePay||2.99% or free (landlord has the choice to cover the fee for you)||RentShare takes your credit card payment and makes an online payment into the landlord’s linked bank account.||Yes|
|Rent Track||2.95% or free (landlord has the choice to cover the fee for you)
Or, $9.95 monthly subscription fee with no processing fees
|Rent Track provides a payment service for landlords, allowing them to accept online credit card payments from tenants.||Yes|
|Cozy||2.75%||Cozy helps facilitate credit card payments to landlords and deposits money into their bank accounts.||Yes|
|Zego||3%||Zego is an app that accepts renters’ credit card payments and puts money in their landlords’ banks.||Yes|
|Rentler||2.9% or free (landlord has the choice to cover the fee for you)||Rentler helps manage all facets of apartments, from applications to payments. They help renters pay with a credit card.||Yes|
|ClickPay||2.95% or free (landlord has the choice to cover the fee for you)||ClickPayRent accepts your credit card payment and transfers the funds to your landlord as a direct deposit, given that both you and your landlord have registered accounts with them.||Yes|
|Venmo, PayPal, etc.||Typically around 2.9%-3%||These money-transferring tools can be used to transfer any kind of payment. They require both the sender and recipient to have accounts, each of which is linked to the user’s bank or credit card account.||Yes|
Other Ways to Pay Rent With a Credit Card:
Cash Advance - You can take out a credit card cash advance at an ATM, at a branch or by using a convenience check. However, note that credit card cash advances have very high fees and interest rates. The average cash advance fee is over 3% and the average APR is over 21%. Plus, there’s no grace period, so interest starts accumulating immediately.
Balance Transfer - This method is targeted towards individuals who have too many expenses to cover and too little cash on hand. Though you won’t be paying your rent with a credit card directly, you can shift some of your other expenses onto a credit card (via a balance transfer), leaving more available cash to pay your rent.
Pros and Cons of Paying Rent With a Credit Card
Before you decide to pay rent with plastic, make sure to consider the advantages and disadvantages of doing so:
Pros of Paying Rent with a Credit Card:
- Earn Rewards – Paying your rent with a rewards credit card will allow you to boost your earnings with a big expense each month. Such large charges will also be extremely useful when it comes to meeting the initial spending requirement to qualify for a rewards bonus. Just make sure any fees you’re charged for paying rent with plastic don’t outweigh the perks of doing so.
- Convenience – Maybe you won’t be in town the week rent is due or you’re not able to get to the leasing office during business hours. Paying with a credit card by phone or online offers the convenience and flexibility that many other forms of payments lack.
- Safety Guarantees – Some third-party apps guarantee that your payment will reach the property manager on time and will cover any late fees or other costs associated with payment problems. After all, you’re trusting them with the roof over your head. For example, here is RadPad’s guarantee below:
- Financial Coverage – It doesn’t matter if you’re short on money this month – your property manager will still want your rent. So, unless you have a willing friend or relative who can foot your bills in the meantime, using a credit card is your next best option – especially if you can pay it off in full during the grace period.
- No Bounced Checks – Imagine you write your rent check and your landlord doesn’t cash it for two weeks. By that time, you’ve depleted some of the funds in your bank account and the check either bounces or triggers an overdraft fee. Paying with a credit card helps you avoid such a scenario.
Cons of Paying Rent with a Credit Card:
High Fees – The cost of using a third-party app to pay your rent with a credit card typically hovers around 3% of the transaction. That’s paying a lot for the convenience of using plastic.
If your rent is $1,200, for example, then the fees amount to around $35. If you pay your rent with an app every month, you’d be spending around $420 on fees each year. With that being said, the best rewards cards offer 2% cash back across all purchases, so using one of those you’d really end up costing yourself $144.
- Limited Credit Line – Paying for rent with a credit card may be an extremely impractical option for consumers with limited or bad credit history, as they will most likely have low card limits. However, those with secured credit cards do have the option of adding to their deposit to extend their credit line enough to cover rent.
High Credit Utilization Ratio – Given that rent payments are typically high charges, they might negatively affect your utilization ratio and damage your credit score. Again, individuals with limited or bad credit history will be affected by this more. The combination of their low credit lines and the high cost of rent makes them especially vulnerable to high utilization.
For example, if your credit limit is $4,000 and your rent is $2,000, you’ll use 50% of your spending potential on housing alone. Given that we caution against exceeding 30%, you’d be in danger of compromising your credit score by paying your rent with your credit card.
- Potential Budgeting Issues – If you begin using a credit card to pay rent, you may be tempted to use the extra cash you have on hand. This could set you back when it comes to your financial goals (e.g. college fund, retirement), or even lead to expensive debt.
- Interest Expense – If you carry a balance on your credit card between months, you’re going to pay interest on all of your credit card charges, including your rent payments. Considering that rent is probably your biggest regular expense, these interest charges can add up quickly, unless you have a 0% APR card. Plus, introductory APRs don’t last forever.
Alternatives to Paying Rent With a Credit Card
If you don’t have a credit card – or you do, but aren’t keen on adding a hefty processing fee to your already-expensive rent bill – there are several additional payment methods that will get the job done. For starters, the third-party payment apps listed above all work for debit cards as well. The fees for those are typically cheaper than those for credit cards (sometimes, they are even free). Or, you could use one of these methods:
- Do a bank wire transfer
- Use a debit card
- Write a paper check
- Pay in cash
- Pay with a money order
While it is certainly possible to pay rent with a credit card, the transaction can be more complicated and more expensive than paying with other methods. If possible, it’s probably best to pay your rent with cash or a check each month. But if you do need to pay by card, try to avoid processing fees or offset them with credit card rewards.
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