Can You Make Your Car Payment with a Credit Card?

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Last updated on August 24th, 2023

Using credit cards offers a variety of benefits, including the ability to earn rewards and repay balances over time. But can you use a credit card to make payments on recurring charges like rent, mortgages, or even your car’s loan? Can you make your next car payment with your credit card?

Can You Use a Credit Card to Make a Car Payment?

Making payments on installment loans or housing and utilities with a credit card isn’t straightforward – but it is possible. And since car payments fall under the installment loan umbrella, yes, you can make your car loan payment with your credit card. Here’s how:

Online and Mobile Payment Services

Making payments mobile and online services like Plastiq is one of the simplest ways to pay car loans, rent, mortgages, utilities, and other recurring costs not typically covered by credit cards. Services like Plastiq act as a third-party broker and accept payments by wire transfer, debit card, or credit card. The payee inputs the relevant information into the Plastiq system pays the required amount (and surcharge), and then Plastiq makes the payment to the lender.

Similar products to Plastiq include:

  • GoCardless
  • Thryv
  • Melio
  • Bravo
  • PlacePay
  • RadPad

The benefits of using a credit card to pay your car loan include the ability to repay over time (with interest) and the chance to earn reward points or cash back on those loan payments.

Benefits of Paying with a Credit Card

Many cards provide additional rewards for purchases in select categories, such as groceries, utilities, or travel. While making mortgage payments isn’t a bonus category, many rewards cards offer a minimum reward for simply using the card. Typically, this is a single point or 1% cash back. Additionally, monthly charges like rent, utilities, or auto loans, can help new cardholders reach impressive introductory bonuses – often worth hundreds of dollars in points.

Making your car payment with your credit card can also give you some breathing room when in a tight situation. Because credit cards offer the ability to repay the balance before the statement date without interest, making your car payment with your favorite card can help you ensure your payments are on time while waiting for a paycheck, government check, or another windfall.

Things to Keep in Mind

Before you make your next car payment with a credit card, consider the following:

  • Using a credit card for large payments may increase your credit utilization rate. This increased credit use could lower your FICO Score.
  • If you don’t pay off the car payment before the statement period ends, your payments will incur additional interest. Additional interest will increase your monthly payments and offset any rewards you could earn.
  • Always pay attention to the fees and surcharges with services like Plastiq, Melio, and others. These fees might make paying with a credit card not worthwhile – especially if they cost more than the value of cash back you might earn.

Related Article: Can You Pay Your Mortgage with a Credit Card?

Featured image by Matthew Henry / Burst

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About: Cory Santos
Cory Santos

Cory is the senior credit card editor at BestCards, specializing in everything credit card-related. He’s worked extensively with credit cards and other personal finance topics, including nearly five years at BestCards. Cory’s extensive knowledge is an essential part of the BestCards experience, helping readers to live their best financial lives with up-to-date insights and comprehensive coverage of all facets of the credit card space, including market trends, rewards guides, credit advice, and comprehensive credit card reviews.

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