For most households, rent and mortgage payments represent the largest monthly outflow of cash. Traditionally, these are paid via bank transfers or checks, leaving consumers unable to accumulate the travel rewards or cash back that typically come with credit card spending.
However, new fintech solutions and specialized credit cards have changed this dynamic. While there are often fees involved, savvy users can turn these massive expenses into engines for earning high-value points.
The Challenge: Avoiding Transaction Fees
The primary hurdle in paying housing costs with a credit card is the interchange fee. Most landlords and mortgage lenders do not want to bear the cost of processing a credit card transaction, so they either refuse credit cards or pass the fee on to the tenant.
- The Ideal Scenario: Negotiate with your landlord or apartment complex to accept credit cards without an extra charge. While rare, this is the “holy grail” of rewards spending, as it allows you to earn full points on thousands of dollars in spending for free.
- The Reality: Most people will encounter a processing fee. To make this worthwhile, the value of the rewards earned must exceed the cost of the fee.
The Bilt Strategy: A Specialized Approach
The Bilt program has carved out a unique niche by allowing users to pay rent and mortgages without the typical high transaction fees. Unlike standard credit card payments, Bilt often uses the ACH (Automated Clearing House) system to pull funds from your bank account, which bypasses many credit card processing costs.
How Bilt Rewards Work
Bilt offers different “pathways” for earning rewards, which requires users to be strategic:
- The Bilt Cash Method: You earn “Bilt Cash” on non-housing purchases (at a rate of 4%). You can then redeem this cash to “unlock” Bilt points on your rent payments. This is essentially a way to convert everyday spending into rent rewards.
- Direct Housing Rewards: You can earn points on housing payments even without a Bilt credit card, though you will likely face fees. If you use a standard Visa, Mastercard, or Amex through their platform, you may only earn a fraction of a point per dollar spent.
- Partnered Cards: Certain cards, such as the Atmos Rewards or United MileagePlus cards, offer specific point multipliers when used through the Bilt ecosystem.
Using Third-Party Services (Plastiq and Venmo)
If your landlord doesn’t accept credit cards, you can use a “middleman” service to bridge the gap. These services allow you to pay a bill with a credit card, and they then send a check or transfer to your landlord.
- Plastiq: The most established player in this space. It is highly versatile and allows for mortgage payments (specifically with Discover, Mastercard, or Diners Club), but it does charge fees. It is most effective when Plastiq runs promotional periods with lower fees.
- Venmo: A common option for peer-to-peer rent payments. Using a credit card via Venmo typically incurs a 3% fee, whereas using a debit card is usually free.
When Does Paying a Fee Make Sense?
Paying a 2% or 3% fee to pay your rent might seem counterintuitive, but there are two specific scenarios where it is mathematically beneficial:
1. Meeting Sign-up Bonuses (SUBs)
Many premium credit cards require you to spend a large amount (e.g., $5,000–$6,000) within the first few months to trigger a massive welcome bonus.
Example: If a card offers a bonus worth $1,400 after spending $6,000, paying a $150 fee to cover your rent via that card is a smart move. The “cost” of the fee is dwarfed by the value of the bonus.
2. Maximizing High-Value Points
If you are using a card like the Citi Double Cash, which earns high rewards on all purchases, and you can find a low-fee promotion (like a 2% promo on Plastiq), the points you earn may still outweigh the transaction cost.
Summary of Top Card Options
If you are looking to optimize your housing payments, consider these categories:
– Ecosystem Players: The Bilt Palladium Card is designed specifically for this purpose.
– High-Value Bonus Seekers: Cards like the Atmos Rewards Summit Visa Infinite or United Quest offer massive initial point boosts.
– Consistent Earners: The Capital One Venture X or Chase Freedom Unlimited are reliable for general spending and meeting large requirements.
Conclusion
While paying rent or a mortgage with a credit card usually incurs a fee, it can be a highly profitable strategy if used to hit large sign-up bonuses or through specialized programs like Bilt. Always perform a quick cost-benefit analysis to ensure your rewards are worth more than the processing fees.
