Can you use a 0% interest credit card to pay down mortgage?

Question

Can you use a 0% interest credit card to pay down a mortgage balance?

Chris Mason · Answer

Let's say you charge $20k onto a credit card that's maxed out at $20k, and as such you save 4% on that $20k for 18 months.

$20k*4%*1.5= $1200 saved.

It took 18 months to save that $1200. That's $66.67 per month and you probably tanked your FICO score by maxing out the credit card.

You're on THIS website, and you can't think of a better way to generate/save $67 per month?

Linda S. · Answer

@Deadrick Colbert,

You could, but it will be 3-5% upfront balance transfer fee.

You can't write off that interest on your tax returns, whereas you can with the mortgage interest. If you're at the final leg of your mortgage, chances are you're mainly just paying principal, so I highly doubt it would be worth it. the extra headache. Why wouldn't you just pay down only principal on your mortgage?

Jay Hinrichs · Answer

Ok I got that what happens when the interest on the card kicks in.. also keep in mind you max out a card and your fico drops like a rock

Jay Hinrichs · Answer

i guess but why would you.. its not zero % for ever..

Deadrick Colbert · Answer

@Chris DeMello In the past, I have used helocs to buy additional properties but not to pay down the original mortgage. The ultimate goal would be to completely pay off the mortgage but a credit card would only partially pay it down, not completely pay it off.

@Christina Linn Thanks for the response. In the past, I have used the money to buy more properties and that's worked well. I'm thinking of focusing on paying down some of the debt now.

Christina Linn · Answer

If it was me I would buy another property to generate more income and not worry about the higher interest. That being said, you can do what you’re asking, but it’s risky, because you might not be able to pay off if something else comes up and it will likely cost 3-5% anyway - if you don’t pay off it’s suddenly at 20%+.

Chris DeMello · Answer

@Deadrick Colbert you ever looked into a 1st position HELOC to pay down your mortgage quicker?

If you're talking about paying off the whole mortgage balance with the credit card then that could be a great idea. Is that the case?

Brady Wolfgram · Answer

Make sure that if you don’t pay it off in the 18 months that they don’t go back to day one for interest. Most no interest cards are retroactive if you don’t pay it off in time.

Deadrick Colbert · Answer

@Jay Hinrichs I like the sound of paying down one of my higher mortgage rates at 0% for 18 months as opposed to paying the higher interest rate of the mortgage.

Joe L. · Answer

Yes but you start paying interest after a year or so once the introductory period ends. Also, many of them have an upfront fee that is usually 3% of the amount.

Can you use a 0% interest credit card to pay down mortgage?

Can you use a 0% interest credit card to pay down mortgage?

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