Paying off a mortgage with a credit card for points

[Royback]

I am about to pay off my mortgage.

I think I can use Mastercard but not Amex.

What cards would anyone recommend I apply for or maximise my points. I will pay off the cards immediately.

Any suggestions welcome. Has anyone done similar?

The Barclaycard avios looks good. Spending several tens of thousands.

Cheers

[jarul]

Are you sure your bank will actually let you use any credit card? As its normally limited to debit cards

[BA Flyer IHG Stayer]

this –

jarul wrote:

Are you sure your bank will actually let you use any credit card? As its normally limited to debit cards

Before counting your points check with your mortgage holder on what they will and won’t accept.

[The Savage Squirrel]

Even if they’ll let you, I’d do a small test transaction first. It’s possible that the transaction will incur substantial fees from the credit card provider.

[Aston100]

Paying credit with credit (even if you find a way (and some do exist BTW)) is fraught with dangers.

[Ash]

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

[Ash]

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

If you do find the lender does allow credit card payments please share the lender’s name.

[Royback]

Ash wrote:

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

Thank you. The credit score tip is good. I did not know this. I will pay off my Mortgage with cash. I am exploring the possibilities that may exist to maximise this timing position.

Nobody would borrow on a credit card to pay their mortgage. Well…..not me!

I was looking for advice from anyone who has done it.

I can definitely make an overpayment of 10% of the balance. But that is not too much. I will try first

[Carlos]

Ash wrote:

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

If you do find the lender does allow credit card payments please share the lender’s name.

Might not matter to anyone who is paying off their mortgage and isnt getting another one.

[Royback]

Carlos wrote:

Ash wrote:

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

If you do find the lender does allow credit card payments please share the lender’s name.

Might not matter to anyone who is paying off their mortgage and isnt getting another one.

Haha. I might still like-a decent rating to accumulate points! But no more mortgages!!!

[Rui N.]

That’s not a concern. There aren’t enough credit cards in the UK for you to apply for that to be a problem.

[Aston100]

Carlos wrote:

Ash wrote:

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

If you do find the lender does allow credit card payments please share the lender’s name.

Might not matter to anyone who is paying off their mortgage and isnt getting another one.

And this is why I’m never scared to dance the Brighton Boogaloo.

[onion]

I’ve done this with a ~£175k balance on a Bank of Ireland mortgage using the HSBC premier world elite MasterCard in 2020.

It was a great success.

We did a test payment of £100 to check it would all go through, be taken off our mortgage balance, not result in any charges at either end, and accrue points. Success.

We had around a 30k credit limit and max single payment was 12.5k, set by BoI. We did 2 payments in a day (one primary cardholder, one secondary cardholder), paid off card balance the same day, waited for payment to clear and then went again 2 days later. Very lucrative.

Worth noting that HSBC have sent a bunch of emails since then highlighting they were tightening things up so that cash-like transactions didn’t accrue points. That could impact this.

[NorthernLass]

Agree many lenders would not allow you to do this. We are paying off our FD mortgage in chunks but they will only allow bank transfers – and from an account in the name of one of the owners. We had more luck paying off £12k car finance last year split between Virgin and Barclays avios cards.

[jj]

@Royback, you may want to check the timing of payments against the Early Redemption Charges (ERCs) set out in your mortgage offer. ERCs normally decline over time, and you normally have a 10% annual allowance for ‘free’ overpayments but the definition of ‘annual’ veries between lender. You may find that it’s a better deal to split your lump-sum repayment to maximise the 10% benefit. The maths is a bit tricky, but you need to look at ERCs, interest saved and possible interest earned on the cash in the meantime.

Also note that the 10% allowance isn’t normally given if you repay in full. Mlinstead, make a 10% overpayment, wait a few months, then redeem.

[Royback]

NorthernLass wrote:

Agree many lenders would not allow you to do this. We are paying off our FD mortgage in chunks but they will only allow bank transfers – and from an account in the name of one of the owners. We had more luck paying off £12k car finance last year split between Virgin and Barclays avios cards.

Thank you. V helpful. Appreciate your help.

[Royback]

NorthernLass wrote:

Agree many lenders would not allow you to do this. We are paying off our FD mortgage in chunks but they will only allow bank transfers – and from an account in the name of one of the owners. We had more luck paying off £12k car finance last year split between Virgin and Barclays avios cards.

Thank you. V helpful. Appreciate your help.

jj wrote:

@Royback, you may want to check the timing of payments against the Early Redemption Charges (ERCs) set out in your mortgage offer. ERCs normally decline over time, and you normally have a 10% annual allowance for ‘free’ overpayments but the definition of ‘annual’ veries between lender. You may find that it’s a better deal to split your lump-sum repayment to maximise the 10% benefit. The maths is a bit tricky, but you need to look at ERCs, interest saved and possible interest earned on the cash in the meantime.

Also note that the 10% allowance isn’t normally given if you repay in full. Mlinstead, make a 10% overpayment, wait a few months, then redeem.

Termination in a few months time but can overpay 10% with a non Amex card. Not sure if any fees yet. Will try and report back. Cheers.

[eshaq786]

Ash wrote:

Opening one or more cards within a six month period will knock down your credit score. Maxing out the credit cards will also impact the score. Even though they will be paid off immediately the the initial trigger will be immediate, whereas the notification they’ve been paid will take 6 weeks+ to filter through to the credit score. Just something to be aware of.

Not sure if that’s strictly true as I’m pretty sure that banks only report to credit agencies once a month and not on a live basis as things happen. Therefore if you pay it off immediately, it will just report a balance of 0.

[The Urbanite]

Some good information in this thread but definitely some waffle too.

If you can’t pay off directly, why not top up a bank account that earns points for doing so, then bank transfer those funds to make the payment? An example that a lot of people were doing is Revolut, which used to accept credit cards without fees. You’ll have to find one that works for you.

[Ash]

The UK bank accounts that award avios are Barclays and Citibank.

Revolut now charges for credit card top ups? I don’t have one but was considering getting it.

You could try Currensea, Monese, Wise to see if they charge for credit card tops or not.

[DonLee]

The Urbanite wrote:

Some good information in this thread but definitely some waffle too.

If you can’t pay off directly, why not top up a bank account that earns points for doing so, then bank transfer those funds to make the payment? An example that a lot of people were doing is Revolut, which used to accept credit cards without fees. You’ll have to find one that works for you.

Those time were long gone

[ExpatInBerlin]

Deleted – wrong thread

[The Urbanite]

DonLee wrote:

The Urbanite wrote:

Some good information in this thread but definitely some waffle too.

If you can’t pay off directly, why not top up a bank account that earns points for doing so, then bank transfer those funds to make the payment? An example that a lot of people were doing is Revolut, which used to accept credit cards without fees. You’ll have to find one that works for you.

Those time were long gone

Yes, for Revolut perhaps as it was the golden goose that got killed. The opportunities exist but it’s a case of looking for what’s on the market and finding one that works with the cards you have and your personal circumstances.

[Harrier25]

Ash wrote:

Revolut now charges for credit card top ups? I don’t have one but was considering getting it.

Revolut doesn’t charge for credit card top-ups, it doesn’t allow them full stop.

[Royback]

It has Worked! Mastercard avios!