Can You Pay Rent with a Credit Card?

When it comes to budgeting your monthly living expenses, you may find yourself looking for alternative means to make your rent payment, including paying rent with a credit card. While paying your rent with a credit card is possible, it often comes with fees. It’s important to evaluate the pros and cons to decide whether you should cover this month’s rent with your credit card.

Can you pay rent with a credit card?

The first thing you should do when considering making a rent payment with a credit card is consult your lease. Your lease will detail how payments should be made and through what preferred payment method. Some property managers will allow the resident to pay rent with a credit card, but not all. If your lease does not specify that you can pay rent with a credit card, reach out to your landlord directly for confirmation.

Most often you can pay rent with a credit card. If your property management company allows credit card payments, credit can be a great way to cover costs if you do not have cash funds available. However, paying rent with a credit card can lead to expensive fees. We’ve outlined a few other pros and cons of paying rent with a credit card to help you decide if this is the right payment method for you.

Pros of paying rent with a credit card

There are a few advantages of paying rent using a credit card, including:

• Convenience: Paying your rent with a credit card may be more convenient than other options, like writing a check. It can also be a faster option if you are nearing your rent due date.
• Easy tracking: Some renters enjoy the easy tracking of spending that is available when paying with a credit card. Unlike with a check or cash, you can identify the day your fund’s transfer and your property manager receives payment.
• Flexibility: Paying with a credit card can also be a more flexible option. Because using a credit card is similar to borrowing funds, you don’t have to wait until you receive your paycheck to pay rent.
• Build credit: Credit agencies report on-time payments to the credit bureau, which can increase your credit score. Having a good credit score is important if you plan on buying a house.
• Sign-up bonus: Credit cards often offer incentive bonuses to new cardholders. This requires that you spend a certain amount within a specific time period to receive the bonus points. It can be difficult to reach this spending amount and paying your rent can help you reach bonus status even faster.

Perhaps one of the biggest benefits of using a credit card for rent is as an emergency option. If you lose your job or have to manage unexpected finances, you can always turn to your credit card until you can get back on track financially.

Cons of paying rent with a credit card

There are a few considerations to consider before paying rent with your credit card, including:

• Fees: Most credit cards charge fees when you use them to pay rent. Depending on your card, you may be able to offset some of these costs by taking advantage of credit card rewards. However, the value of credit card rewards typically doesn’t make up for the card fees. The median average cost of rent in the United States for a 1 bedroom apartment is $1,374 per month. The average credit card processing fee is between 1.3%-3.5%. This means that it’ll cost you between $17 and $48 extra each month. That adds up to $204-$576 more in rent each year.
• Interest: If you don’t pay off your rent each month and carry a balance on your credit card, you could also be subject to interest.
• Credit score: Another implication of carrying a credit card balance is that it can affect your credit utilization rate. This is a calculation that compares the total amount of credit you have with how much you use, and having too high of a utilization rate can decrease your score. A low credit score can also make it difficult to rent properties if you decide to move.
• Credit limit: Depending on your card’s limit, paying rent on it may put you closer to it. If you don’t pay off other purchases or charge multiple months at one time, you risk going over your limit.

Paying rent with a credit card can be expensive. It’s important to calculate the cost when deciding if it makes sense financially to use a credit card.

When should you pay rent with a credit card?

Because there are high fees and costs associated with using a credit card to pay rent, there are only a few situations in which you should do so. You might pay rent with a credit card in the following situations:

• You don’t have cash available: If you don’t have cash available to pay rent, your only option may be to put it on a credit card. While this may cost you fees, it may also save you late fees from your property manager.
• Your rewards outweigh the costs: If you have a credit card with exceptional rewards or are working toward a new customer incentive bonus, then it may make sense to pay rent using a card.
• You pay your balance in full each month: Carrying a large balance on your credit card can cost you a lot in interest, significantly increasing the cost of your rent. If you have to pay this month’s rent on a credit card, try to pay it off as soon as possible to avoid these costs.

Sometimes, a credit card may be your only option for paying rent. If you’re relying on credit this month, try to get the most out of it by maximizing your rewards and paying the balance off as soon as possible.

If you decide that it makes sense to pay this month’s rent with a credit card, you have a few options to do so. It’s important to evaluate your options carefully because they each have different fees and processes. You also want to check that your property manager is okay with receiving rent via credit card and confirm any additional fees that could be added to your rent by property management when processing your payment.

Paying rent with a credit card has pros and cons, and it’s important to evaluate them to decide if it makes sense for you. You may also have other options available when it comes to paying rent that are worth considering.