Picking up Nickels

Wednesday, August 16, 2006

MBNA Bill Pay Choice: Pay Your Mortgage With a Credit Card

Did you know that you can pay your monthly mortgage payment with an MBNA credit card?

MBNA offers a bill pay service (MBNA Bill Pay Choice), which allows you to pay bills with your MBNA credit card.
MBNA Bill Pay Choice (a rebranded version of CheckFree's Bill Payment service) is free when making payments to Payees funded exclusively with your MBNA credit card.

MBNA's bill pay service allows you to pay bills from a variety of vendors including mortgages from ABN AMRO, Bank of America, Chase Home Mortgage, and Washington Mutual Mortgage as well as credit cards from American Express, Chase, Citibank, and Discover (see Checkfree's Which Bills Can I Pay Here? for a more complete list of participating vendors).

The big advantage to this strategy is that you can float your monthly mortgage or credit card payment for an additional month. Why not keep that money in a high yield savings account for an extra month and make some additional interest on MBNA's dime?

One disappointment is that only "In-Network Payment" bill payments are eligible for credit card points or rewards. Unfortunately, I have yet to find a single payment that is "In-Network".

For those of us that pay our credit card bills in full every month, I have no idea how MBNA makes any money from this bill pay service. Perhaps this is yet another example of how naive consumers subsidize sophisticated ones. As for me, I will keep using this service for my mortgage and credit card payments until MBNA/Bank of America decides otherwise.


  • Wow, paying mortgage monthly payment with credit card is what I have been looking for. I started with Fidelity's pay-by-phone in 1980 (long time ago). Thanks!!

    By Anonymous Anonymous, at 8/22/06, 1:14 PM  

  • One thing to watch out for with this strategy:

    I just used MBNA billpay for my payment this month and added a little extra principal. For some reason, my mortgage company decided to credit the additional principal to my escrow account.

    A quick phone call cleared it up, but I had to chuckle when the CSR recommended that I use their payment service (with $13.00 processing fee) to avoid future problems.

    By Blogger Frugal Frugalson, at 8/23/06, 4:00 PM  

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