Pay Your Mortgage With a Credit Card Via ChargeSmart

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ChargeSmart is a bill payment service that allows you to pay many bills with a credit card that usually don’t accept such payments, including mortgages, auto loan, student loans, and utilities. Only participating vendors are eligible, but they seem to have signed up several large companies including Bank of America/Chase/Wells Fargo mortgages, Sallie Mae student loans, and Ally Financial auto loans. In general, it works with all Visa, MasterCard, and Discover branded cards.


If you have a rewards credit card, this service gives you the ability earn cashback or frequent flier miles on more purchases. You’ll also be able to take advantage of your card’s grace period since you won’t have to pay up until your credit card bill is due (up to 45 days later depending on when you charge in the statement cycle). If you have a card with a introductory 0% APR on purchases, you could extend the interest-free period even longer.

Another side perk would be for $500+ credit card bonuses, where you use this service to meet the minimum spending requirements. For example, the Chase Sapphire Preferred® Card will get you $625 in travel after you spend $4,000 in purchases within the first 3 months. If you’re a little short, paying a 2-3% fee to reach that requirement is worth it since a $625 bonus on spending $4,000 is effectively 15.6% back. (You’ll also get 1.25% back on your purchases toward travel as rewards.)


In most cases, there is a fee involved that depends on the vendor. This may or may not be worth it to you, depending on how much you value your credit card points or miles. Here are a few special cases to consider.

Discover Utility Bill Fee Rebate (Expired)
Previously, if you used a Discover card to pay a participating utility vendor, Discover would have provided an instant rebate your Chargesmart fees. Paying my water bill would have otherwise cost me $16.40 for a $500 payment (3.28%), or $6.10 for $50 payment (12.2%). You’ll even earn all the usual rewards that your Discover card offers. I like the Discover More card for their 5% back on rotating categories feature.

Hidden “Large Payment Security Fee”
You should be aware that their initial fee calculator can be somewhat misleading. I was trying to pay a test payment to a mortgage lender for $2,000, and was given a fee quote in Step 1 for $21.95, which was 1.1% of $2,000. Not bad, I thought, you can get 1.5% cash with something like the Capital One Cash Mastercard.

Step 2 is your address information, and Step 3 is your credit card information. So far so good. But in Step 4, they tacked on a “large payment security fee” which added another $25.71 to make the total fee amount $47.66, working out to 2.4% of $2,000. Trying out some different lenders, the final fee amount seems to always work out to about 2.4% for payments over $1,000 or so.

One last wrinkle… there’s a little box that tells me if I sign up to make this payment every month, I’ll get $10 off this first month’s payment. (You can cancel later.) That would make it $37.66 out of $2,000 or 1.88%. That makes it a little better, but not a screaming deal. But for meeting bonus requirements, a mortgage/auto loan/student loan payment is an easy way to charge something you need to pay anyway.

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  1. I wonder if you could just break it up into smaller payments

  2. Blue Steel says

    I like this strategy, but whenever I take accounts off direct debit bad things happen.

  3. say what says

    Seriously, all these pain to get a few rewards bucks. wow talk about being cheap.

  4. @Say what says

    on a 2000 mortgage payment, at 1% back, thats 20 bucks a month, or 240 a year. i think thats worth the effort to try and figure this out once

  5. say what,

    I wouldn’t exactly call it “pain”, but yes it takes some work. A little here, a little there. It adds up.
    Last year, my wife and I got over $4000 in “a few rewards bucks”. In a way it’s enjoyable. We don’t even need the rewards bucks.
    All our rewards we donate to a local charity, and they appreciate it very much. Never have they called me cheap; not to my face at least.

    In the time it takes you to watch American Idol, I am done with all these pain of getting a few rewards bucks.

    Rewards bucks… it’s already growing on me:)

  6. Bummer!! They actually added my old mortgage holder (wasn’t there before), but we just refinanced with a credit union. I can keep my fingers crossed and keep checking.

    Being able to charge the mortgage would be a dream. I am earning 2% back on everything, and mortgage is under $1000/month now. So, this could be an easy $10/month saved if the fee was only 1%.

    @say what – This is “barely lift a finger to save a ton of money” type stuff. Hardly what I would call “being cheap.” Of course, I earned about $4,000 tax-free last year barely lifting a finger. 😉

  7. Just want to make sure that I have this correct…

    Is it safe to say that if the percentage of rewards that I’m going to get back on my card is LESS than the total percentage it would cost me to make the payment, that I should NOT do this.

    I am not trying to meet any short-term rewards goals. Just using my Chase Rewards card on a regular basis for all purchases.

  8. Great in concept but as Jon points out, usually a hidden gotcha or 2 to make it break even (a best) with a ton of hassle. Look into exactly this to prepay a utility bill for the points and got hit with the large payment fee, not exactly forthcoming when it applies, a call to them was a bit misleading as well.

    I appreciate Jon’s motivation to point out these little apparent arbitrage opportunities in exchange for time/effort in case one hits a home run (think the US Mint dollar coins here) and don’t think its “cheap” to do so). But I suspect in a few months the value of his time is going to change dramatically…. 🙂

  9. This blog is all about sharing but I hope that screenshot is not Jonathan’s actual account number/servicer for his mortgage.

    United Explorer card give 10,000 bonus miles when you spend $25,000 (which is 35,000 miles total). Buying 35,000 miles is about $1700 on United. Under this scheme, @2.4% fee, it would cost a person $840 to get 35,000 miles. Not a great deal but could be OK with the right mileage availability.

  10. I checked it out – my mortgage fee was even a bit higher than yours, and the only small-bill company I use on there is my gas company – and the fee is a whopping 11%?!

    Of course they’ll refund that fee if I sign up for a discover card.

    No thanks, this is not a consumer friendly model. They claim to remove the fees from the biller, but they pass on even higher handling fees than average to the customer. It’s another excuse for these companies not to handle CC charges properly, and I don’t want to encourage that. The only difference between this and similar third party charge-handling sites is that it has a more consumer-friendly website.

  11. Previewed how much a typical mortgage payment would cost and the fee was almost 3%. Hard to justify that except as you said in the case where you want to meet one of those $500+ credit card bonuses.

  12. Do you know if you always get an instant rebate with the Discover More card to eliminate the ChargeSmart fee? if so, then it is definitely worth using the service.

  13. Curtis, Jonathan said it was a partial rebate for “utility” payments–that’s all. Doesn’t seem totally worth it to me.

  14. AARP needs to bring back their 5% for 6 months deal… : )

  15. Jason said: “Buying 35,000 miles is about $1700 on United.” 35k miles on United is not worth $1700. United charges a high price if you buy miles from them but that is not how much the miles will be worth to you. A roundtrip in the US costs 25k miles so 35k is worth around 1.5 flights. 1.5 flights is worth more like $300 to $900.

  16. I long time ago discovered this site: my mortgage is under $1000 so no security deposit fee for me- and even if you have $2000 payments I think you can structure them at something like $999 & $999 – may still be cheaper. And even for receiving $100 when spending $1000 is worth it. Since I’ll be damn if I were to buy stuff I don’t need just to satisfy my credit card requirements for the bonus!

  17. @Curtis…I just phoned ChargeSmart regarding the instant rebate with the Discover card for paying utility bills. I was told that you only get the instant rebate if you manually enter the information each month. If you sign up for automatic payment, the Discover rebate does not apply. I asked if the Web site would have provided me with that information when I set up autopay, and the customer service rep said “no” and that it was a good thing that I had called in to learn this important piece of information. He also said that this Discover instate rebate promotion has been going for several months, but that it may end at any time.

    Their phone number is: 866-724-2743

  18. @Bill – thanks so much for the info! It’s definitely not worth it to do it then. I’d rather not risk a late payment by having to remember to pay my bills every month through ChargeSmart.

  19. No, that’s not my mortgage number, but if it was, do you think people would make some payments for me? 🙂

  20. @Curtis Just set up a repeating calendar event in Google Calendar. That’s how I do things like this 😀

  21. I was looking into this before, but I never got to stage 4. The large payment fee is a bullshit fee that should up in step 1. It’s pretty sleazy to give you a quote, have you enter in all your info and spend time on it, and then change the quote based off info they knew back in stage 1. Thanks for the heads up.

    I don’t understand why this is profitable to pay a $999 mortgage. Assuming you have a $20 fee, you aren’t going to make money from the deal.

    You get the best bang for your buck by making a $5000 payment or so, and perhaps knocking out the chase ink 5k in 3 months deal in one swoop.

  22. This may have been clear to everyone else, in which case, my apologies, but the Discover card rebate of fees is not available for mortgage payments, only utilities.

    Thank you for your E-mail. The Discover promotion only applies to manually submitted utilities payments (i.e., recurring payments for utilities set up using a Discover card are not applicable for the promotion). The fees for mortgage payments are not rebated through the Discover promotion.

    Best regards,
    ChargeSmart Support

  23. Yeah, I tried their service once before to meet the minimum spending requirement on British Airway Chase Visa card by charging my mortgage on it.
    The fee I ended up paying was ridiculous. Haven’t used it since. But as long as you can keep the fee to a minimal or zero, this would be great to use.

  24. I have to agree with most of the comments here, it really breaks down to how much you value your time. If you make more than $10/hr, “deals” like this don’t seem worth the hassle, potential aggravation, and worry that your bills might not get paid properly. I like most of the suggestions, but this one seems a bit arduous.

  25. Jenna, Adaptu Community Manager says

    Sounds like a great idea, especially if they could get rid of the large sum fees.

  26. I’ve been using ChargeSmart just for my electric and gas bills from Discover for several months now. Most months I earn under $1 in rewards from this but I do it more to take advantage of the grace period.

  27. @jim – When I wrote “is $1700”, I meant “costs $1700” for United. I thought the context made that clear. The point was that if you needed 35,000 miles for a trip, this service would be a cheaper way to get it that buying it directly if you already had the card. As I said, this probably only works if you can use the miles on an otherwise expensive route.

  28. Why would you pay your utilities through Chargesmart? Most utilitiy bills you can pay online with your credit card with no fee and that would help you gain mileage points. Large payments such as a mortage are the only transactions that make Chargesmart a viable option for travel rewards. Whadaya think?

  29. It seems like Chargesmart has ended their promotion with Discover.

    @Mark – Over the past two years, all but one of my utility companies have stopped accepting credit cards or added surcharges to pay with credit cards.


  30. @Jared – Thanks for the update, looks like you’re right.

  31. Hi everyone, here is what im thinkg about to do, tell me if it make sense to do it.

    i recently got 25yr mortgage for 88000, and 4.25%. also got cc with 2400 limit and 0% for about 13 months.

    so, i want to use charge smart to make like a one payment ( lets say 2300) it should be 2350 with fees, and will pay off this cc in a year, how much money will i save by doing this??

  32. Anne Marie says

    I got no transaction fee checks from my Capital One card. Do you know any reason why I couldn’t use one to pay my mortgage. It doesn’t list mortgage in the add, but it does say I can pay anywhere that doesn’t accept credit cards.

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