Have you ever wondered if you could pay rent and get cashback with a credit card? Well, you’re actually right because you can! In fact, making recurring payments easy, fast and rewarding is one of the key benefits of using a credit card.
This also translates to paying rent as a tenant, no matter whether you are a working professional renting an apartment or a business owner renting a workspace. There are, however, numerous factors you must consider before you pay your rent with a credit card.
Is it a Good Idea to Pay Rent Using Your Credit Card?
The overall ease of using a credit card to pay rent is hugely beneficial. The liquidity this offers you when it comes to a big-ticket payment like rent is also a big factor in considering it.
Added to this, the reward points and offers can make such payments more pocket-friendly, and who doesn’t want that? However, you may think of it as a last resource simply because failing to pay credit card bills on time can attract higher interest.
So, the decision lies with you. If you can ensure you keep aside your rental dues from your salary each month and ensure you can pay your card bill on time, you can end up saving money if you use your credit card.
Before going ahead, ensure you consider additional charges of issuers to pay rent, such as processing fees, convenience fees, transaction charges and more. Weigh them against the benefits, such as cashback, and then make your decision.
What are the Benefits of Paying Rent With a Credit Card
Here are some important reasons why this can be a good idea.
Get Advance Finance
Let’s say you don’t have sufficient account balance to pay the rent, but the due date is approaching. In such a case, it can be smart to use your credit card. This way, you have enough time to arrange for the funds, using which you can pay your credit card bill.
Earn Reward Points
Most credit cards allow you to rack up reward points when you make transactions, which can double or triple when you cross annual milestones. Paying rent with a card can help you get more points and enjoy the perks.
Annual Fee Waiver
If you want to avoid credit card renewal fees, rent payments add to your annual transaction value to help make you eligible for it.
Boost Your Credit Score
Timely credit card bill payments are the easiest way to grow your credit score. If you are new to credit or working on boosting your score, paying rent using your card is a good opportunity to gradually increase your creditworthiness.
Convenience and Flexibility
Using your credit card every month, you can ensure you don’t miss rent payments. By automating the process, you can pay rent with a click, no matter where you are.
Things to Consider Before Paying Rent With a Card
Here are a few things to keep in mind when going this route:
- Some issuers may allow you to use only up to 30% of the credit limit to pay rent so check the cap, if any
- Keep fees and charges applied on rent payments in mind, and avoid using your card if they are too high
- See if you can keep your total credit utilisation ratio under 40% with rent included to keep your credit score high
- Ensure you have savings you can fall back on to cover your credit card bill in case of cash crunches to avoid high interest charges
Considering these factors, you can decide if making rent payments with a credit card is the right choice. In some cases, there are no offers on rent and even the best cashback credit card may not give you any additional benefits. In such cases, see if using a card is actually beneficial for you.
You can get both offers and additional reward points when you use the One Credit Card to pay rent. Check the latest discount and cashback offers on rent payments on its App, and you can also earn 5X rewards on the top two spending categories each month.
Once you have paid, the transaction is recorded in your history, and you can repeat the payment without needing the landlord’s banking details every time. This way, the One Credit Card makes it easy for you to pay rent and earn a lot of other rewards, dining offers and more. Apply online and enjoy more savings today!
