Can you pay your mortgage with a credit card in Canada?
The short answer: Yes, but it’s complicated
Can you pay your mortgage with a credit card in Canada? Can you pay your rent or mortgage with a credit card in Canada? The short answer is yes, but it’s not as straightforward as swiping your card at the landlord’s office. There are several factors to consider, including additional fees, potential benefits, and the methods available to make it happen.
How to pay your rent with a credit card in Canada
Just like your mortgage you can also pay your rent with a credit card. Paying rent with credit cards is the same process as paying a mortgage, meaning you can expect to pay that 2.5% to 3.5% (or higher) transaction fee should you choose to use a card to pay your landlord.
Landlords typically request payment by cheque or money transfer from their tenants. Similarly, borrowers normally pay their mortgage by setting up automatic withdrawals from a chequing or savings account or by completing payments on their lender’s website.
How to make rent or mortgage payments with a credit card
Third-party payment services
The most common way to pay rent or mortgage with a credit card is through third-party payment services. Here are some options:
- PaySimply: Accepts Visa, Mastercard, and American Express for various bills, including rent, mortgage and other payments. They charge a 2.5% fee on all credit card payments.
- Plastiq: Allows Mastercard payments for mortgages, with a 2.85% fee.
- RentMoola: For rent payments, this service charges a 2.5% fee on credit card transactions.
Cash advances
Another option is to use your credit card for a cash advance. However, this method comes with significant drawbacks:
- High cash advance fees (usually around $3.50 to $5 per transaction)
- Higher interest rates (typically around 19.99% or more)
- Interest charges begin immediately, with no grace period
Pros of paying rent or mortgage with a credit card
1. Earn rewards points or cash back
If you have a top rewards credit card, you could potentially rack up significant points or cash back. For example, if your rent is $2,000 per month and you’re earning 2% cash back, that’s $40 in rewards each month or $480 per year.
2. Meet minimum spending requirements for welcome bonuses
Many of the best credit cards in Canada offer lucrative welcome bonuses if you meet a minimum spending requirement within the first few months. A large recurring payment, such as rent or mortgage, could help you reach that threshold quickly.
Read More: Best welcome bonus credit cards
3. Improve your credit score
Regular, on-time payments of large amounts can potentially boost your credit score, assuming you’re paying off your credit card balance in full each month.
4. Cash flow management
Using a credit card could buy you some extra time to pay your housing costs, potentially helping you avoid late fees or other penalties.
Cons of paying rent or mortgage with a credit card
1. Transaction fees
The biggest drawback is the fee charged by third-party services, typically ranging from 2.5% to 3.5%. On a $2,000 monthly payment, that’s $50 to $70 in fees each month.
2. Potential for high-interest debt
If you can’t pay off your credit card balance in full, you’ll incur high-interest charges, typically around 19.99% or higher.
3. Impact on credit utilization
Using a large portion of your available credit for housing payments could increase your credit utilization ratio, potentially negatively impacting your credit score.
4. Limited acceptance
Not all landlords or mortgage lenders accept payments through third-party services, which limits your options.
Bottom line
While it’s possible to pay rent or mortgage with a credit card in Canada, it’s not always the most financially savvy move. Before making a decision, carefully weigh the potential rewards against the associated fees and risks. Remember, the smartest financial strategy is often the one that keeps your housing costs manageable and your debt levels low.
If you’re considering this option, start by crunching the numbers. Calculate the potential rewards, factor in the fees, and consider your ability to pay off the balance each month. And always remember: just because you can pay your housing costs with a credit card doesn’t necessarily mean you should.
FAQs
Can I pay my mortgage directly to my bank with a credit card?
- Generally, no. Most Canadian banks don’t accept direct credit card payments for mortgages. You’ll likely need to use a third-party service.
Are there any credit cards specifically designed for rent or mortgage payments?
- As of 2025, there aren’t any Canadian credit cards specifically designed for rent or mortgage payments. However, some cards offer higher rewards on recurring bill payments, which could include these expenses if paid through certain methods.
Will paying rent with a credit card help build my credit score?
- Potentially, yes. Regular, on-time payments can have a positive impact on your credit score. However, if using a credit card significantly increases your credit utilization ratio, it could have a negative impact.
