Can you pay rent with a credit card?

Yes, you can pay rent with a credit card in many instances. It could make sense if you want to earn rewards or need financial flexibility. However, it’s helpful to understand the potential advantages and disadvantages that come with it.

What you’ll learn:

• Some landlords may accept credit card payments directly. If not, third-party services can handle paying with your credit card.

• Consider whether you can make on-time payments on your card each month. Missed or late payments can affect your credit and may lead to late fees and higher interest rates. 

• You can weigh potential rewards against costs when deciding whether making a rent payment with a credit card might be useful to you.

If your landlord or property management company accepts rent payments via credit cards, you can typically make your monthly payment to them in person or online. The process is similar to paying with a debit card. But rather than the money coming out of your bank account, it shows up on your credit card statement.

Some landlords may not accept credit card payments. In this case, third-party services can handle paying rent with a credit card. Typically, though, a processing fee will be added to your transaction.

That can depend on your credit card issuer. A cash advance lets you borrow funds against your credit card’s line of credit. Since cash advances can come with fees and higher interest rates than typical credit card purchases, it may help to know about your card issuer’s policies.

If you’re considering using a credit card to pay rent, here are possible benefits and drawbacks.

Potential benefits of using a credit card to pay for rent could include: 

• Earning rewards and bonuses: Depending on the card, you may be able to earn credit card rewards like miles or cash back when paying your rent. Using a new credit card might also help you earn a sign-up bonus, if offered.

• Building credit: If your credit card activity is reported to the credit bureaus, paying rent with your card could help you build credit history and improve your credit scores. That’s as long as you use your card responsibly.

• Safeguarding against late payments: Paying with a credit card might help you avoid late payments if your rent is due before you have the cash available. Plus, your credit card may offer online bill pay, which you can use to set up automatic payments to help pay your bills on time.

Potential drawbacks of using a credit card to pay rent could include:

• Credit card debt: Using a credit card to pay rent could mean adding to your credit card balance. Checking the terms of the card and verifying that you can pay your bill on time could help you avoid credit card debt.

• Interest charges: If you don’t pay off your balance in full by the due date, you may be charged interest. Depending on your credit card’s interest rate, you could spend more over the course of your lease paying with a credit card than if you used a debit card or other option for paying rent from your bank account.

• Third-party merchant fees: If you have to use a third-party service to pay rent with a credit card, it could mean additional fees. These fees can vary widely and might outweigh benefits gained from using your credit card.

• Negative impact on credit scores: Late or missed payments or a high credit utilization ratio may negatively impact your credit scores. To help protect your scores, the Consumer Financial Protection Bureau (CFPB) recommends making payments on time, paying your balance in full and keeping your credit utilization ratio under 30%.

Paying rent with a credit card can be a helpful option if you need financial flexibility or want to earn rewards. But consider weighing the pros and cons first.

If you’re looking for a credit card, you can see if you’ll be approved with 100% certainty for a Capital One card—without hurting your credit scores.