Can you pay your mortgage with a credit card? The answer is YES. I’ve been doing that every month for two years. No, I’m not talking about third party programs which charge you a fee of more than 2% of the payment amount. That’s not smart. I don’t pay any fee or interest. Although I don’t get credit card reward points for the mortgage payment, I receive free float. January mortgage payment is charged to the credit card on January 1. The credit card bill isn’t due until after Feb. 15. When every mortgage payment is deferred by a month, it’s equivalent to having one monthly payment in my pocket as an interest-free loan forever.
You need a credit card by FIA Card Services. FIA Card Services is the new name for MBNA after Bank of America bought it. Eligible cards include Fidelity Investment Rewards Visa (I have this card), the new Fidelity Retirement Rewards American Express, or the new Schwab Bank Invest First Visa, and perhaps some other cards also offered by FIA. The last two cards both pay 2% cash back on all purchases, which is the best you can find. These cards have online bill payment service just like checking accounts do. FIA calls it Bill Pay Choice. Set up your mortgage payment as a recurring bill and the card will pay your mortgage every month. Bill payments are treated as regular purchases, not cash advance. I then set up auto-debit from the card to my checking account for the full balance on the due date (call customer service for a form). That guarantees the card balance is paid off in full and on time every month. It’s all free and fully automated.