Should I use a credit card to pay off a car loan?
I'm wondering if I can save money by moving my car loan debt to my credit card.
Answer provided by
Eric Schad
Answered on Mar 25, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
“Typically this is a poor idea, but there are certain scenarios where paying off a car loan with a credit card may benefit you financially. Some credit cards offer promotional or introductory periods that provide zero percent APR for nine, 12, or 15 months. So if you have a car loan with a higher interest rate than zero (which is likely), a credit card may save you money.
Keep in mind that a majority of lenders won’t take credit cards for car loan payments. Furthermore, you should make sure you can still pay the monthly amount on your credit card, as most of these promotional interest rates will revert to a rate that’s much higher (usually 20% or more) if you miss a payment.
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