For this strategy to work the key is to make sure you dont end up overspending in pursuit of credit card rewards which obviously defeats the purpose. In some ways it makes sense and it may even work to your benefit.
can i use student loans to pay credit card
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Many student loan companies will not allow you to make a payment with a credit card and those that do may charge a transaction fee to cover the cost of credit card processing fees.
Can i use student loans to pay credit card. These are all reasons to explore paying your student loans with credit cards. Well can you really pay student debt with a credit card. However if a fee is required to pay your student loan with a credit card you may pay more in fees than you earn in rewards.
Borrowers can strategically use 0 credit card into rates to save on interest. Using credit card rewards to pay student loans can be a strategic way to make a dent in your payments and earn money from things you would spend money on anyway. Maybe youve even pondered whether you can pay student loans with a credit card.
Is it earning a lot of credit card rewards. Can you really pay your student loans with a credit card. If however you decide to use cards and you cant pay off the balance each month are you ok with the possibility of that dinging your credit score.
For example if you have a card with a 12 month introductory rate and you use it to have an intermediary service pay down your student loan by 1200 you would be charged 30 by the intermediary service giving you a credit card balance of 1230 that you would need to pay off in 12 months. So you can likely pay off your credit card with student loans without. Paying off student loans with a credit card is an ideal scenario for many borrowers.
So often people think it makes sense to use low interest student loans to pay off high interest credit cards especially when they just dont have the cash on hand to pay off the cards. As a student loan borrower youve probably felt the pinch of those monthly payments and wondered if theres a better way to deal with your education debt. Credit card interest rates can be much highersometimes as high as 20 or even close to 30.
Can you find better terms with a card than your loan offers. Using a credit card to pay off student loans has two big advantages. Its not ideal for every situation but paying student loans with a credit card can help you earn thousands of rewards points that can be used for travel gift cards and more.
Borrowers can quickly rack up credit card rewards and points and. You can just use excess student loans to pay it off and deal with the. When you pay your student loan with a rewards credit card you can earn points miles or cash back just as you would on other purchases.
Even if you can use your credit cards over the long term it likely will be more expensive to pay your student loan debt with a credit card. Learn how to do it the right way here. Nerdwallet is a free tool to find you the.