Maximizing Cash Back = 90% CL usage

[Anonymous]

I understand the argument that any fees associated with paying your mortgage via CC usually outweigh or wash the rewards received on the CC.  I wouldn't ever pay my mortgage for this reason.  I would however pay my mortgage via CC if it was a wash (fees vs rewards) if I were either trying to hit a spend bonus or if I was looking to show extra usage on a card due to an upcoming CLI attempt.  I think those are 2 perfectly valid reasons to use a CC to pay a mortgage.

[Anonymous]

"Except that you are spending outside your budget. A mortgage payment should be expected to be a cash payment directly from a checking or savings account, with cash on hand, with no extra fees involved. That is ( should be ) your basis for your budget."

(Sorry about the quote formatting, I'm replying via mobile)

This is false... at least in my situation. As I stated in my original post, the CC balance would be paid as soon as the CC company cleared it. In my experience, for some of my charge transactions there arebusually a few days when a charge is pending for some reason. I have the money, I just wanted an additional opportunity to earn some cash back on a purchase I make on a monthly basis.

Anyway, I hadn't considered the fact that there could be additional fees associated with making a mortgage payment using a CC.

Obviously no one in their right mind would think it would be a good idea to pay (for example...) a 3% transaction fee for 2% cash back.

If i could have simply logged on to my mortgage account, updated the auto billing with my CC # and no transaction fees would be assessed, they I would absolutely pay using a CC.

Unfortunately I can't not set up auto pay directly using a CC. As I previously stated, the process that would allow me to pay using a CC involves far too many steps and time I'm not willing to give.

Thanks so much to everyone who took the time to reply and offered helpful feedback.

[Anonymous]

Slightly off topic here, but those that have paid their mortgage with a CC in the past, by what means have you done so and are there places that charge a 2% or less fee for the transaction?

[digitek]

Thanks for the thread, always wondered if this would ever really work.

There are a few things I've found that a CC can't be used for payment without a fee.

Mortgage
Taxes
Gas/Electric bill (Duke Energy)

Unfortunately, those are some of my largest recurring monthly expenses 😒

Also, GunBroker.com, it is perfectly normal for them to say in the details of the auction that they are going to charge you the CC processing fee. That's the only website I ever see it on regularly, like by default.

[longtimelurker]

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@digitek wrote:
Thanks for the thread, always wondered if this would ever really work.

There are a few things I've found that a CC can't be used for payment without a fee.

Mortgage
Taxes
Gas/Electric bill (Duke Energy)

Unfortunately, those are some of my largest recurring monthly expenses 😒

Also, GunBroker.com, it is perfectly normal for them to say in the details of the auction that they are going to charge you the CC processing fee. That's the only website I ever see it on regularly, like by default.

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Same with me but for some utilities either don't charge a fee or charge a flat fee, in which case prepaying a few months can be worthwhile

And at times Plastiq has had specials where the fee was less than 2% for a while (if you signed up for some program).   Just have to be careful to check when the special rate ends!

[Gmood1]

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@Anonymous wrote:

Slightly off topic here, but those that have paid their mortgage with a CC in the past, by what means have you done so and are there places that charge a 2% or less fee for the transaction?

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I've used Plastiq for over a year now. I have it set to autopay my mortgage for the next three or four years. As the LTL says, you have to catch it when they offer special.

[Anonymous]

How often do they offer a special, how do you find out about it and what is the fee percentage when you get in at a better deal?  Also, how long does it last at the more favorable rate?

[longtimelurker]

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@Anonymous wrote:

How often do they offer a special, how do you find out about it and what is the fee percentage when you get in at a better deal?  Also, how long does it last at the more favorable rate?

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You can get a (partial) list from https://www.plastiq.com/blog/category/promotions/

But travel/MS sites such as FrequentMiler, pointsguy etc will inform you of active/upcoming promos.

As you can see from the first link, they really vary.   Most recent involves signing up for 6 payments, the first two are free, the rest at a normal rate.  So assuming 2.5%,  you pay to at 0% and 4 at 2.5%, an overall rate of 1.6667% rate allowing you to make a profit on a 2% card (or on points you value at more than 1.6667 cents per point.

But the August 2016 one was more valuable, 1.75% (with an MC) for however long you choose to schedule, which could be years  (taking a slight risk that an overall better promo wouldn't appear.)

Note that you don't necessarily rake in the cash.   If your payment is $5K per month, the 0.25% margin is $12.50 a month (and correspondingly less for smaller mortgages)  And, since you have to pay Plastiq earlier than you would have the mortgage company auto-withdraw, this should be reduced by some amount of lost interest.   Still, for those that get excited over the $25 per quarter with BBR...........

[Anonymous]

Thanks for the link and info.  Again, for me, it's not about the rewards.  For me it's about increasing spend.  I have a a few CLI requests coming up between August and November (certain cards eligible at 6 month marks) and it would be nice to drive some extra spend through those cards prior to the CLI requests.  For me, as long as it constitutes a break even (or slight reward) situation, it's "worth it" to me to consider one of these payment options at least in Q3-Q4 2017.