We devote thousands of hours of research to help you get Big Travel with Small Money. You support us by signing-up for credit cards through partner links which earn us a commission. Here’s our full Advertising Policy.

Planning to Buy a Car?  Here’s How to Earn Credit Card Rewards for Your Purchase!

Planning to Buy a Car?  Here’s How to Earn Credit Card Rewards for Your Purchase!

JasonPlanning to Buy a Car?  Here’s How to Earn Credit Card Rewards for Your Purchase!Million Mile Secrets Team

We devote thousands of hours of research to help you get Big Travel with Small Money. You support us by signing-up for credit cards through partner links which earn us a commission. Here’s our full Advertising Policy.

Jason:   Considering a car purchase and wondering if it’s possible to rack up a few thousand miles & points using a credit card to buy it?

In short, it is!  And you can even use a credit card to make your monthly car payment too!

This is great news for folks looking for ways to meet a card’s minimum spending requirements, earn extra rewards, or qualify for a yearly spending bonus for a purchase you’d make anyway!

Can You Buy A Car With A Credit Card
Getting a New Car Is Fun. But Earning Miles, Points, or Cash Back for Your Purchase Is Even Better!

I’ll show you how to put some (or all!) of the purchase price of a car on a credit card.  And mention a few pitfalls you should look out for!

Can You Buy a Car With a Credit Card?

Here’s what you need to know before you consider paying for a car with a credit card:

  • If you sign-up for a new credit card before buying a car you can potentially earn a lot of money or travel by meeting the minimum spending requirement with a single purchase!
  • AMEX has a program in place to allow you to pay for a car with your credit card, making them a great card issuer to use when buying a car!
  • Not every dealer will let you use a credit card to pay for a car, so you might have to shop around
  • You might only be able to put a down payment or pay for part of the car with a credit card
  • The dealer might charge you more to pay with a credit card (but there’s a way around that!)
  • Credit card interest can add up for you if you don’t pay off your balance, making it a potentially bad deal!

Buying a car can be stressful and usually requires some serious negotiating skills.  Wouldn’t it be nice to earn miles, points, or cash back, for your purchase?

The good news is, in some cases, it’s possible to put at least part of the purchase price of a car on a credit card.  And some dealerships even allow you to put the entire cost of a car on a card!

Can You Buy A Car With A Credit Card
Meeting a Card’s Minimum Spending Requirement and Earning a Big Sign-Up Bonus Could Get You a Trip to Paradise!

This could help with meeting minimum spending requirements, reaching yearly card spending bonuses for elite status or bonus rewards, or to simply earn lots of miles, points, or cash back.

That said, there’s a bit of strategy involved using a credit card to buy a car.

Tips for Buying a Car With a Credit Card

First, keep in mind the dealership will have to pay a credit card processing fee if they decide to accept a card.  This fee could be ~1% to ~3% of the sales price, depending on what type of credit card you’re using.  Assuming a $30,000 vehicle price and a 2% processing fee, that’s $600 ($30,000 X 2%).

Now let’s say the dealership usually makes a ~$1,500 profit off that $30,000 car.  $600 in credit card fees is nearly half of their profit!  So you can see why dealerships are very particular about whether they’ll accept credit cards.  And if they let you pay with a card, they might be less willing to offer a discount on the vehicle price.

This video from The Credit Shifu does a great job of explaining why it might be better to negotiate a cheaper price instead of trying to buy a car with a credit card to get points.

Luckily, lots of dealerships will at least let you pay the down payment with a credit card.  And folks who have done this before suggest NOT mentioning you plan on using a credit card until you’ve agreed on the price of the car.  Otherwise, the sales representative might consider the credit card processing fee while negotiating the price.

Folks have reported being able to put anywhere from $1,000 to $10,000+ of the cost of a car on a credit card.  And it can work for the down payment on a leased car too.  So it’s certainly worth asking!

And American Express has an auto purchase program.  Some dealerships participating in the program will allow you to put the entire cost of a car on an AMEX card!  

This could be a great way to meet bigger minimum spending requirements, like the $20,000 tiered minimum spending requirement on the current offer for The Business Platinum® Card from American Express OPEN.

Can You Buy A Car With A Credit Card
Check the Map on the AMEX Auto Program’s Website to See If There’s a Participating Dealership Near You!

And you might even be able to make multiple payments with different cards, which can help you meet more than one minimum spending requirement!

Downsides to Consider

If you don’t have enough cash to pay in full for the car, buying the car with a credit card is a terrible idea for you!  Because any miles & points you earn will be negated by the interest you’ll accrue on the purchase.

But you could use a card with a promotional rate to save on interest.  Some cards offer 0% interest on purchases for 18+ months.  Just be sure you can pay off the balance before the promotional interest rate expires.

Another issue you might run into is not having enough credit.  For example, say you want to buy a $10,000 car and only have a $7,000 credit limit.  With AMEX cards, there’s a way to check online whether you can spend above your credit limit.

For other cards, you could call the credit card company to see if they’ll raise your credit limit.  But be sure to ask whether this will count as a hard credit inquiry because this can potentially impact your credit score.

Finally, it’s a good idea to set the cash advance limit on the card you’re using to $0.  Then you won’t have to worry about being charged cash advance fees that would cancel out the value of any rewards you’d earn!  And it’s a good idea to call your credit card company ahead of time and let them know you’ll be making a large purchase so it isn’t declined.

Which Card to Use to Buy a Car?

Buying a car with a credit card for rewards can be a great way to collect extra miles & points.

But you’ll earn even more points if you use your car purchase to meet the minimum spending requirement on one of the best credit cards for rewards.

Plus, there are many fantastic rewards credit cards, which earn 2X per $1 spent.  So you could use a card like the Capital One® Venture® Rewards Credit Card (2X Venture miles on all purchases) or the Capital One® Spark® Cash for Business (2% cash back on all purchases).

On a $5,000 down payment, you’d earn $100 in rewards (2% X $5,000).  And that’s not including any sign-up bonus you might qualify for!

When I make large (or small) purchases, I prefer to earn transferable points whenever I can.  Because while a cash back card can earn you 2% in rewards, you can potentially get much more value having the ability to transfer points to airline or hotel partners.  That’s how you get Big Travel with Small Money!

Can You Buy A Car With A Credit Card
Cash Back Is Great, but Transferable Points Can Get You Big Travel!

You can also consider the AMEX Platinum small business or personal card if you plan on paying for a car with a credit card.  Because there is already a program in place for using AMEX credit cards to buy a car.  And the AMEX Platinum cards come with extremely valuable bonuses!

The Platinum Card® from American Express card comes with a 60,000 AMEX Membership Rewards point bonus after you spend $5,000 on purchases within the first 3 months of account opening.

Every once in a while some folks are targeted for a huge 100,000 AMEX Membership Rewards point bonus on this card through the CardMatch tool.  If you’re one of the lucky ones, then buying a car with the AMEX Platinum personal card becomes much more of a “no-brainer” deal.

If you qualify for small business cards (you might and not even know it!), it makes a lot of sense to get the AMEX Business Platinum card to use for a car purchase.  Small business cards from AMEX do NOT appear on your personal credit report.  So they won’t count toward your Chase “5/24” limit, which will give you a better chance of earning lucrative bonuses on other cards in the future!

And the AMEX Business Platinum card comes with a bigger welcome bonus.  You’ll earn 50,000 AMEX Membership Rewards points after spending $10,000 on purchases within the first 3 months of card membership.  And you can earn an additional 50,000 AMEX Membership Rewards points by spending another $15,000 on purchases within the same first 3 months of card membership.

Can You Buy A Car With A Credit Card
Purchasing a Car With Your AMEX Platinum Card Is an Easy Way to Meet the Minimum Spending Requirement and Earn a Big Bonus!

The $20,000 minimum spending requirement on the AMEX Business Platinum card is a lot for most folks to spend in 3 months, which is one reason why buying a car with this card makes sense!

Use Plastiq to Make Car Payments

If you plan to finance your vehicle purchase, you don’t have to miss out on earning valuable rewards.

You can use a service, like Plastiq, to make you car payment.  This is a great way to meet your minimum spending requirement!  And Plastiq already has a lot of car financing companies listed as payment options.  So the process is even more seamless.

You’ll pay a 2.5% fee to use their service.  So if you make a $400 monthly payment, you’ll pay an extra $10 ($400 X 2.5%) for the convenience of putting the charge on your card.  For me, this is worth it if I’m working toward earning a big sign-up bonus.  But otherwise I wouldn’t pay the extra fee to earn points because the rewards I earn from $400 of normal spending usually aren’t worth $10.

Bottom Line

It IS possible to pay for some (or all!) of a car’s purchase price with a credit card.  But you’ll likely have to negotiate with the sales representative.  And some folks suggest mentioning you’d like to use a credit card AFTER the price of the car is agreed upon.

Also, if you don’t have enough cash to pay your credit card bill in full after you purchase the car, do NOT use a credit card to make the purchase.  Because the interest you’ll pay will negate the value of any rewards you earn.

Otherwise, being able to charge a few thousand dollars to a credit card for a purchase you already plan on making could be a great way to meet minimum spending requirements, meet yearly card spending bonuses for elite status, or to earn lots of miles!

 

 

 

 

If you liked this post, why don’t you join the 25,000+ readers who have signed-up to receive free blog posts via email (only 1 email per day!) or in an RSS reader …because then you’ll never miss another update!

The Business Platinum® Card from American Express OPEN

The Business Platinum® Card from American Express OPEN

  • Limited Time Offer: Earn up to 100,000 Membership Rewards® Points.
  • Earn 50,000 Membership Rewards® points after you spend $10,000 & an extra 50,000 points after you spend an additional $15,000 all on qualifying purchases within your first 3 months of Card Membership. Offer ends 8/8/18.†
  • Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com.
  • Get 50% more Membership Rewards® points. That's 1.5 points per dollar, on each eligible purchase of $5,000 or more. You can get up to 1 million additional points per year.
  • 35% Airline Bonus: Use Membership Rewards® Pay with Points for all or part of a flight with your selected qualifying airline, and you can get 35% of the points back, up to 500,000 bonus points per calendar year.
  • You can also receive 35% points back on all First and Business class flights, with all airlines available through American Express Travel.
  • You can enjoy access to The American Express Global Lounge Collection℠ offering access to the most lounges across the globe, when compared with other U.S. credit card offerings. As of 11/2017
  • Terms Apply
  • See Rates & Fees
Terms Apply | Rates & Fees

More Info

Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)

Add comment

E-mail is already registered on the site. Please use the Login form or enter another.

You entered an incorrect username or password

Sorry that something went wrong, repeat again!

10comments

by Newest
by Best by Newest by Oldest

I recently bought a new car and the Dealer let me put $18K split between 6 cards on it. You can read about it here.
https://truptravels.com/2018/01/07/buying-our-car-on-credit-cards/

Author

That’s a baller move! Great way to save on the fees you mentioned in your post.

I have purchased a new Toyota Prius and a dealer certified used Chevy Volt.

1. Survey the dealers in the surrounding states and see who is willing to pay for the ENTIRE purchase via rewards credit card(s).

2. Shop your bands/models you are interested in.

3. Hint: Dealers usually make more on used, than new cars.

4. Dealers with service department pay closer to 1% fees, not the 2% listed here. (COSTCO charges 1.38% to any member wanting to process cards, do you really think dealers are so dumb they don’t negotiate closer to 1% or below???)

5. Take your time!!! (every time you “think” about it, they come back with a better offer). The longer the car sits on the lot the better the deal becomes.

6. Make sure you get “out the door” pricing. Dealer prep, licensing, document prep. are all a scam for PROFIT.

7. Be prepared to use some miles to go pick up the car. If used, make sure it’s dealer certified.

8. Do it all over the internet.

I’d make a top 10 list, but David Letterman has retired, and so have I 😉

Author

This is an amazing list! I love #5, 6, and 3.

Also, Daraius, has used #7 before to buy a car. Not sure if purchased with a card though.

https://millionmilesecrets.com/2017/12/04/how-to-save-money-on-a-new-car/

I got the Volt from a dealer in Denver and the salesman volunteered to drive it out to Salt Lake, if I bought him a $25 Frontier flight back to Denver. It’s amazing what a dealer will do to make a sale.
This purchase went over about 40 days of internet negotiations. No voice contact even 😉

Being disciplined is the hardest thing for most buyers. They’re too eager and not prepared to walk away.

I just bought a new Honda two days ago (before reading this post) and I was able to put $4000 on my AMEX as a down payment to get points. I’m pretty sure I could’ve put more if I wanted to but I financed the rest. The dealership didn’t charge me a surcharge or convenience fee. The manager even asked if I wanted to put the down payment on a cc to get the points!

A few years ago I purchased a car from a dealership in Australia fully on a credit card. After a couple weird looks, they agreed to it. Major points with that one.

Of course, I paid off both purchases immediately to avoid interest charges. Car purchases are great ways to get lots of points quickly!

Author

Dani, this is great! For the car purchase in Australia did you also use an AMEX card?

Over the past few years, we have purchased a brand new truck and a used Cadillac totally using credit cards. The Simple Solution is to already have your money saved and your plan in place to purchase the vehicle. Planning ahead, we positioned ourselves with three big bonus credit cards to make the actual purchase on our last one. One of those credit card was the American Express Business Platinum with 100,000k bonus. The CSR with 100,000k bonus and SPG 35,000k rounded out our choices and with those three credit cards we were able to purchase totally using these three credit cards, a pre-owned Cadillac SRX from Enterprise Car Sales. Quality of their resales and the ease of transactions with no credit card fees made this a winner. When the bills came due at the end of the month, we paid them completely off ! We celebrated with an around-the-world award trip!

Author

Mara, I love it! That’s such great planning and nailing those 2 100,000 point bonuses is huge. I’ve heard buying used rental cars can be a good idea, glad to hear it worked well.