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The standard way to pay a loan is in cash, either with a bank account transfer or a check. If money has been tight, or if you're hoping to earn cash back on the loan payment, you may be asking yourself can you pay off a loan with a credit card. It's possible, but in most cases, it's going to cost you.
Yes, you can pay a loan with a credit card, but it's usually less convenient and comes with extra fees. If you can afford to make your loan payment from your bank account, that tends to be the better option.
Hardly any lenders accept credit card payments. They almost always require you to pay with an ACH transfer from your bank account or a check. There are, however, a few workarounds that allow you to pay loans using credit cards. Here are your options if you want to do this.
A balance transfer credit card can be used to transfer over your debt and pay it off at a lower interest rate. These cards often have a low introductory interest rate on balance transfers. The top options offer a 0% intro APR on balance transfers for 12 months or longer, so they're a fantastic way to save on interest charges. You can compare a few of them below.
If you're going to pay off a loan with a credit card, a balance transfer will likely be the cheapest option. There are a few things to keep in mind, though:
LEARN MORE: A Complete Guide to Balance Transfers
A cash advance is when you get cash using your credit card. You can do this at an ATM after setting up a PIN on your credit card. The credit card issuer might also offer convenience checks tied to your credit card account. These can be used just like checks from a bank account.
Cash advances aren't recommended as anything but a last resort. They usually have higher interest rates than purchases, and the card issuer can start charging you interest on the advance immediately. There's no grace period, like there is with purchases you make on a credit card.
LEARN MORE: How Does a Credit Card Cash Advance Work?
If you have any credit card rewards that are redeemable for cash back, you could put them towards a loan payment. Depending on the card, you could have your cash rewards transferred to your bank account or mailed to you as a check. You can normally do this with cash back credit cards as well as some rewards credit cards that earn points.
LEARN MORE: How Do Credit Card Points Work?
This option won't work for everyone, since you need to have some credit card rewards saved to do it. But if you've been using a rewards card and you need some money for a loan payment, don't forget that you can cash in those rewards.
We recommend comparing options to ensure the card you're selecting is the best fit for you. To make your search easier, here's a short list of standout credit cards.
Offer | Our Rating | Welcome Offer | Rewards Program | APR | Learn More |
---|---|---|---|---|---|
Rating image, 5.00 out of 5 stars.
5.00/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
Discover will match all the cash back you've earned at the end of your first year. N/A | 1% - 5% Cashback Earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases—automatically. |
Intro: Purchases: 0%, 15 months Balance Transfers: 0%, 15 months Regular: 17.24% - 28.24% Variable APR |
||
Rating image, 5.00 out of 5 stars.
5.00/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
Up to $300 cash back Earn an extra 1.5% on everything you buy (on up to $20,000 spent in the first year) — worth up to $300 cash back. That's 6.5% on travel purchased through Chase Travel, 4.5% on dining and drugstores, and 3% on all other purchases. | 1.5% - 5% cash back Enjoy 5% cash back on travel purchased through Chase Travel, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 1.5% on all other purchases |
Intro: 0% Intro APR on Purchases and Balance Transfers for 15 months Purchases: 0% Intro APR on Purchases, 15 months Balance Transfers: 0% Intro APR on Balance Transfers, 15 months Regular: 20.49% - 29.24% Variable |
Apply Now for Chase Freedom Unlimited®
On Chase's Secure Website. |
|
Apply Now for Chase Sapphire Preferred® Card
On Chase's Secure Website. |
Rating image, 4.50 out of 5 stars.
4.50/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
75,000 bonus points Earn 75,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's over $900 when you redeem through Chase Travel℠. | 5x on travel purchased through Chase Travel℠, 3x on dining and 2x on all other travel purchases Enjoy benefits such as 5x on travel purchased through Chase Travel℠, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases, $50 Annual Chase Travel Hotel Credit, plus more. |
Intro: N/A Purchases: N/A Balance Transfers: N/A Regular: 21.49%-28.49% Variable |
Apply Now for Chase Sapphire Preferred® Card
On Chase's Secure Website. |
You may have read that you can pay off a loan with a credit card using a third-party payment service. The service that almost always gets mentioned is Plastiq, which allows consumers to pay most types of bills by credit card, but it filed for bankruptcy in May 2023.
Plastiq is still available, and there have been reports that it's processing credit card payments as usual (for a 2.9% fee). But I wouldn't recommend using it to pay a loan or any other type of bill. A bankruptcy filing indicates that the company is going through serious financial troubles, and those could affect payments. If your Plastiq payment is late or bounces, you're the one who's going to get charged a late fee and potentially have your credit score drop.
It's generally not a good idea to pay a loan with a credit card, but this also depends on what your reason is for doing it. The most common reasons are:
You can't make the loan payment. In this case, you may want to pay by credit card so you don't miss your monthly payment and get hit with a fee.
The problem is that you'll end up in a "robbing Peter to pay Paul" situation. To pay one debt, you take out more debt with another company. And credit cards tend to have higher interest rates than loans, which is one reason a credit card balance can be even more difficult to pay off than a loan.
See if you have any other options before using your credit card to cover your loan payment. For example, the lender might be able to help you if you call and ask about a hardship program.
You want to save on interest with a balance transfer credit card. Since many balance transfer credit cards have a 0% intro APR on balance transfers, they can be a good choice for paying off loan debt.
This is the best reason to pay off a loan with a credit card. Just make sure you do the math on whether you'll be able to pay off everything during the intro period. Otherwise, you could end up paying more in interest once that intro period ends and your card's APR increases.
You want to earn credit card rewards on your loan payment. It's every rewards enthusiast's dream, but unfortunately, it's practically impossible to come out ahead because of fees. Credit cards only earn rewards on purchases, not balance transfers or cash advances.
Yes, you can make your mortgage payment with a credit card, but it will most likely cost you extra. Mortgage lenders typically don't accept credit card payments. To pay by credit card, you would need to use a workaround, such as getting a cash advance. That type of transaction has an extra fee, and you get charged interest immediately, so it's not recommended.
In most cases, you can't get credit card rewards for making loan payments on a credit card. If you pay the loan through a cash advance or a balance transfer, you won't earn rewards on those types of transactions. If you pay using a third-party payment service, you could earn credit card rewards. However, the service fees will most likely outweigh the rewards you earn.
It's possible to transfer a loan onto a balance transfer credit card, but whether this is an option depends on the card issuer. Some credit card issuers allow it, whereas others only let you transfer credit card debt.
Our Credit Cards Experts
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