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Should You Pay Rent With a Credit Card?

Blog Post07/11/2017
Debt Management
Should You Pay Rent With a Credit Card?

The best way to pay your rent is online. You won’t have to write any checks or drive anywhere, plus you can automate your payments. Services that allow you to pay rent online typically offer different payment methods, including paying with your credit card or from your bank account.

In this article, we’ll weigh the pros and cons of paying rent with a credit card to help you decide how to pay your rent.

Benefits of Paying Rent with a Credit Card

Credit Card Rewards

There are four main types of credit card rewards: cash back, travel rewards, balance transfer, and gas rewards. Rewards are given out based on the dollar amount of your credit card bill. If you pay rent with your credit card, you’ll be adding a large charge to your credit card. By repeatedly paying rent with your credit card, you have the opportunity to potentially build up significant rewards.

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Fast Process

Writing a rent check, walking to a mailbox, and waiting for your landlord to receive and deposit your check is a long process. If you need to pay your rent as soon as possible, then paying with your credit card is a great option. You can log in to an online payment service, enter payment information, and you’re all set to make a payment. Your landlord will receive immediate notification that you scheduled the payment.

Make a Payment Even if You’re Waiting for a Paycheck

If you’re waiting for your paycheck and don’t currently have sufficient funds in your bank account to pay your rent, then paying with a credit card is a good temporary solution. Instead of waiting to pay rent, you can make the payment on time by paying with a credit card. This is helpful, as long as you make sure you can pay off your credit card bill each month.

The Ease of Paying Online

If you’re paying with a credit card, chances are you’re paying online, which means you’ll get all the benefits of online payments. You can set up automatic payments so you don’t have to log in and pay each month. Automatic payments eliminate the chance that you’ll forget and have to incur late fees. Plus, you won’t have to do any extra work each month.

Drawbacks of Paying Rent With a Credit Card

Processing Fees

When you make a rent payment with your credit card, you’ll likely be charged a processing fee. Processing fees for paying rent online vary, but it’s standard for it to be about 3.5% of the rent payment.

Whenever you use your credit card, the credit card company is assuming some risk because you’re making a payment, but not paying the credit card company back until later. For this reason, credit card companies charge merchants (in this case, the rent processing company) a fee to process payments. This fee is effectively an insurance policy, meant to cover the risk that they won’t be repaid.

The processing fee is important to keep in mind given that it adds to the amount you’ll be charged. If you’re hoping to receive credit card rewards for paying rent, especially cash back rewards, you should calculate whether it is still worth it given the processing fee.

Credit Card Debt

Rent is likely your single largest expense. If you pay it with your credit card, there’s some risk that you might overspend each month. After all, it’s easier to spend more than you have when you’re paying with your credit card.

Managing your expenses is easier and less risky when rent is pulled directly out of your bank account. That way, you can know how much money you have left over for the month to spend on expenses other than rent. If you pay with your credit card, be sure to track how much you’re spending so you can pay off your credit card each month without accruing debt.

Declined Credit Card Payment

Credit card payments can be declined for a few reasons: you’ve reached your credit limit, you’ve missed credit card payments, or something about your transactions signal potential fraud. Whatever the reason, if your credit card is declined and your rent payment doesn’t go through in time, then you risk being charged a late fee. Late fees typically range from $50-100. The risk of this happening is fairly low; however, you could easily eliminate this risk by directly paying out of your bank account instead

Credit Card Information

Credit cards expire and people also switch credit cards from time-to-time. If this happens to be the case while you’re renting, you’ll need to update or add new information to your online payment system. This can be a headache, and can be avoided by paying from your bank account, as people are less likely to open and close bank accounts.

If you forget to change your payment information, you risk missing a payment due to an expired card, and this could result in late fees.

Next Steps

There are both pros and cons to paying rent with a credit card. For some people, especially those with credit card rewards and low processing fees, paying with a credit card may make a lot of sense. However, if you’re tightly budgeting your money and don’t want to be charged a processing fee, then paying online through your bank account is a great option, too.

Whether you’re processing a credit card payment or paying through your bank account, the best way to deliver your rent payments is online. If you’re not already paying rent online, we recommend speaking with your landlord about it. Learn more about how you can pay rent online below.

About Avail

At Avail, our end-to-end software empowers tenants and landlords. As a tenant, you can complete an online rental application, sign your lease online, pay rent online, and manage maintenance all in one place. Thousands of landlords and tenants across the country use our platform to streamline the rental process. Learn more now.

Disclaimer: The information posted to this blog was accurate at the time it was initially published. We do not guarantee the accuracy or completeness of the information provided. The information contained in the TransUnion blog is provided for educational purposes only and does not constitute legal or financial advice. You should consult your own attorney or financial adviser regarding your particular situation. For complete details of any product mentioned, visit This site is governed by the TransUnion Interactive privacy policy located here.

What You Need to Know:

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