[Disclaimer: Information in the table below was accurate as of Saturday, September 15, 2012. Please double check the exact rate for your lender to make sure it is accurate.]
Last week I wrote about how to earn Chase Ultimate Rewards points or cash back by using either a Chase Ink Bold / Ink Plus or the American Express Blue Cash Preferred to buy gift cards to pay your loan.
I’ve created a table below with the ChargeSmart fee for paying $100, $250, & $500 towards your car loan.
Paying $100 or $250 towards your loans is almost always going to be unprofitable because of the high fee which ChargeSmart charges.
But paying $500 towards your car loan using a Visa or MasterCard could get you Ultimate Rewards points or cash back even after taking into account the ChargeSmart fee. But do the math to see if this makes sense for you!
Paying Your Car Loan Off
It also appears that most lenders charge a flat fee for a loan payment, so it could very well be profitable to pay your car loan off (or make a large payment) via ChargeSmart using a credit card without having to buy gift cards in $500 increments.
For example, you pay a flat fee of only $9.95 to pay off any amount to America Honda Finance corporation. So you could use any credit card to pay off, say, a $5,000 loan balance for only a $9.95 fee!
So you’d earn 5,000 Ultimate Rewards points for making a $5,000 payment with your Chase Sapphire Preferred card for only a $9.95 fee.
5,000 Ultimate Rewards points are worth, at least, $50 in statement credit or more if you redeem for travel.
Edit: Readers have pointed out that ChargeSmart levies a sneaky “Large Payment Fee” in Step 4 of the payment screen for many lenders who charge a flat fee. So do the math for yourself before making a large payment.
How to See if Paying $500 via ChargeSmart Makes Sense Continue reading