# Paying recurring bills with credit card?



## hedgehog885 (Dec 13, 2014)

Hello,

I want to get your guys opinion on paying reoccurring bills (cellular, internet, tv, etc) with a credit card. I found articles with a lot of conflicting responses, one being that it can hinder your report scores. Though I cannot understand why it would being that you're using their card, which is basically what they want, more often. I think it may be due to some American policy or some sort. I cannot find any Canadian related so I wanted to ask. What are your thoughts about it? My thought plan was to attempt to get something (really anything) from paying my reoccurring bills using some rewards credit card. My main payment tunnel is online banking through a Canadian financial institution, and obviously you won't get anything. I would be able to pay back the full balance as a lump sum, just as I would if paying separately. It would be nice to get something like points or even cash-back through using their card service. Has anyone attempted this style of payment? Was there any restrictions? Would even paying bills be calculated towards points or cash-back?

Thank you!


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## uptoolate (Oct 9, 2011)

I never really considered whether there is an effect on my credit report and I don't know if there would be. I definitely do pay recurring bills with my credit card - personal or business as appropriate - for the rebate. Bills definitely count as money spent on the card.


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## fraser (May 15, 2010)

We pay everything possible by credit card. We want the reward points.


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## Nemo2 (Mar 1, 2012)

fraser said:


> We pay everything possible by credit card. We want the points.


Ditto.


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## AltaRed (Jun 8, 2009)

fraser said:


> We pay everything possible by credit card. We want the reward points.


+2 Ditto albeit I get it in 'cash back' rather than any kind of points.


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## 6811 (Jan 1, 2013)

fraser said:


> We pay everything possible by credit card. We want the reward points.


We do too and will be using the new Capital One COSTCO card for its "Cash Back" from now on.


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## dotnet_nerd (Jul 1, 2009)

Ditto.

MBNA sends a cheque in the mail every time the rewards reaches $50


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## RBull (Jan 20, 2013)

We also pay all bills possible with Visa for the points on auto pay. Our power bill and taxes are the only things that won't accept credit card. 

If you're paying by the due date how can this hurt your credit score?


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## Guban (Jul 5, 2011)

Paying by credit card with a rewards scheme seems like a no brainer. We use a 1% card that never leaves home, and is used for no other purpose. This is so we can't lose it, and have to worry about having another credit card number issued to pay on time. Ironically, our previous card used only this way was "hacked", and a small charge to amazon.uk came through. I was told it was probably someone trying random numbers, and was reissued another card.


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## hedgehog885 (Dec 13, 2014)

Wow, didn't know a few of you already considered that method. Glad I ask!  I always thought people, at least from listening and reading news, would try to avoid large payment with their credit cards due to inability to makes payment when its due. But I guess those would apply to the irresponsible group.



6811 said:


> We do too and will be using the new Capital One COSTCO card for its "Cash Back" from now on.


Funny that you mentioned that! This thought all started with the new Capital One Costco card which you are awarded for 3 months of double points.

Thanks again people!


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## sags (May 15, 2010)

It can cause a problem if the credit card has a low limit............which some people prefer to use to reduce their exposure to fraud, especially for online purchases.

The "due" date is the date by which the minimum payment is due. A more important date, from a credit reporting viewpoint, is the date they issue the credit card statement.

The balance on that "date" is the one that gets sent to the credit reporting agency.

An example..........if a person has a credit card with a maximum credit limit of $1000.

They pay $900 in bills that month on the credit card............and at the date when the statement is issued the balance shows $900 used of a $1000 limit.............or 90% credit use.

The credit card company issues the statement showing the balance of $900 and the "due" date for the minimum payment a couple of weeks later. 

The person pays in full before the due date but the 90% credit use has already been reported.

It is possible the person always shows a credit card usage of 90%.............but are actually paying off the balance in full each month.

High credit card usage..........balance to limit ratio.........will drop a credit score a few points each month.

It isn't a problem if people have higher credit card limits and only use 30% or less for bill payment.......or pay the balance before the date the statement is issued.


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## OurBigFatWallet (Jan 20, 2014)

I have the Scotiabank Momentum Visa Infinite card and use it for all my recurring bills. I get 2% cash back on them and it seems small but adds up over the year. I can verify it has no effect on credit score. Almost all purchases over $50 go on the credit card as I like to earn cash back on all my purchases/monthly bills


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## Just a Guy (Mar 27, 2012)

I would avoid the auto debit option many companies give you...I often find mistakes on my bills (especially the cell phone), so I manually pay some reoccurring bills on a credit card to get the cash back.

I would expect it to affect your credit rating if you don't pay off your credit cards every month, otherwise I can't see any way it could affect you.


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## scorpion_ca (Nov 3, 2014)

I totally agree with you regarding pre-authorize payment option. I chose that option once and Telus charged more on my CC and I had to waste lot of time to get a refund....they will treat you that it's your mistake....Control your money.

As for credit rating, I use CC for as low as $1 to get the cash back/points though I'm not worried about the rating. Always pay full amount and make money/points by using CC....CC company doesn't make money from me ...



Just a Guy said:


> I would avoid the auto debit option many companies give you...I often find mistakes on my bills (especially the cell phone), so I manually pay some reoccurring bills on a credit card to get the cash back.
> 
> I would expect it to affect your credit rating if you don't pay off your credit cards every month, otherwise I can't see any way it could affect you.


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## MRT (Apr 8, 2013)

scores that drop due to high utilization% are temporary drops that recover rather quickly (in comparison to drops due to late payments, collections, etc. that impact your score for years).

this is another good reason to enjoy a higher credit limit if it is available to you, even if you will likely never make use of it. the higher your credit limit, the lower your credit utilization% will be when you use the card. so even if you pay your balance in full every month, why not have a higher limit to ensure that your utilization% is never high enough to negatively impact your score? 

I know some folks insist upon a really low limit due to an irrational fear of fraud...but you are never responsible for legit cases of fraud, so why worry about that unlikely scenario?

my concern with auto payments is what was stated above...errors. it is far easier to withhold payment for a b.s. charge (e.g. cell phone usage) than it is to recover a disputed payment once it has been taken...but perhaps the points/rewards people receive offsets that unlikely scenario too.


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## RBull (Jan 20, 2013)

Interesting to read about the pre-authorize comments. I have used pre-authorized my cc on all recurring bills for ~20 years - approx $750K charges and have yet to see a mistake or overcharge. So I do not worry in the slightest about this, since I balance/check my bank and cc accounts monthly. I also have no concern about getting something adjusted from a provider if need be. If you have trouble with this you have the wrong provider.


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## My Own Advisor (Sep 24, 2012)

We pay as many bills as we can by credit card. Same reasons above. If going to be paid, might as well earn points/cash back from it.


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## LauraH (Dec 11, 2014)

Does your mortgage provider allow you to pay by cc?


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## hedgehog885 (Dec 13, 2014)

LauraH said:


> Does your mortgage provider allow you to pay by cc?


I'm curious about this too. I personally don't own a property nor am I an expert but I believe mortgages sets principle+interest payments and so isn't that only controlled by the bank being that you're borrowing from them then paying them back? My thought is if they were you allow you to control payments each month of that sizable payment I can see that being a risk for both ends, if payment aren't made on time. However, if cc are allowed and we can control payments, setting pre-authorize payments would definitely be helpful to making payments on time. Plus b onus would be the rewards from the cc.


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## kcowan (Jul 1, 2010)

I am reluctant to give out my bank account information to vendors, so I use a Mastercard that gives the cashback to the SPCA. I seldom use the MC for anything else so that it is just automatic and consolidates lots of smaller charges to one monthly charge. Mortgage payments and rent are not allowed. If they were, you would be paying more to cover the discount rate.


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## Just a Guy (Mar 27, 2012)

RBull said:


> Interesting to read about the pre-authorize comments. I have used pre-authorized my cc on all recurring bills for ~20 years - approx $750K charges and have yet to see a mistake or overcharge. So I do not worry in the slightest about this, since I balance/check my bank and cc accounts monthly. I also have no concern about getting something adjusted from a provider if need be. If you have trouble with this you have the wrong provider.


One of the clients for one of my companies sole purpose is to reconcile phone bills for large companies looking for mischarges/over billing. They routinely find mistakes which save these companies millions. Just last month, my personal cell phone had $70 in mistakes (that could be due to the fact that I changed plans, but it was still a mistake). 

I definately don't find a lot of mistakes from others, though I have from utility companies as well in the past. I've had some try to add charges from other people (tenants who didn't pay for example, which they can't do and I proved to them legally or estimates which were well out of whack). The estimates one is really bad, they overestimate when prices are high, then "rebate" you when prices are lower...I wonder how much they make up in the spread...


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## RBull (Jan 20, 2013)

Just a Guy said:


> One of the clients for one of my companies sole purpose is to reconcile phone bills for large companies looking for mischarges/over billing. They routinely find mistakes which save these companies millions. Just last month, my personal cell phone had $70 in mistakes (that could be due to the fact that I changed plans, but it was still a mistake).
> 
> I definately don't find a lot of mistakes from others, though I have from utility companies as well in the past. I've had some try to add charges from other people (tenants who didn't pay for example, which they can't do and I proved to them legally or estimates which were well out of whack). The estimates one is really bad, they overestimate when prices are high, then "rebate" you when prices are lower...I wonder how much they make up in the spread...


I agree it is worthwhile for some people and some companies to monitor carefully. Millions in mistakes is a VERY LARGE number for any one company to experience. 

It could be that I haven't had issues since my recurring bills are all at a set price so chance of mistake is less. The only one that varies is the actual Visa payment itself. 

I hope I haven't jinxed myself by saying this now, although at some point I'm sure there will be some kind of issue that pops up regardless.


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## AltaRed (Jun 8, 2009)

RBull said:


> Interesting to read about the pre-authorize comments. I have used pre-authorized my cc on all recurring bills for ~20 years - approx $750K charges and have yet to see a mistake or overcharge. So I do not worry in the slightest about this, since I balance/check my bank and cc accounts monthly. I also have no concern about getting something adjusted from a provider if need be. If you have trouble with this you have the wrong provider.


Likewise for longer than I can remember. A complete red herring/paranoia from my perspective (until it happens I suppose).


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## Eclectic12 (Oct 20, 2010)

AltaRed said:


> RBull said:
> 
> 
> > Interesting to read about the pre-authorize comments. I have used pre-authorized my cc on all recurring bills for ~20 years - approx $750K charges and have yet to see a mistake or overcharge. So I do not worry in the slightest about this, since I balance/check my bank and cc accounts monthly. I also have no concern about getting something adjusted from a provider if need be. If you have trouble with this you have the wrong provider.
> ...


YMMV ... the autobill mistake on my father's CC was from a *California* internet provider, where he lived in Ontario. After four or five rounds of talking to CC, then the California Internet provider, a promise of a fix/refund, the next CC statement showing the refund plus a matching new charge - he cancelled the CC.

I personally would have gone through one more round to get the annual cash back before cancelling but he'd had enough.


Cheers


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## MRT (Apr 8, 2013)

LauraH said:


> Does your mortgage provider allow you to pay by cc?


AFAIK, no major lender in Canada permits this, and system limitations prevent it at most lenders anyway (they require the standard institution code, transit, acct number for pre-auth. mortgage payments).

3rd party options have come-and-go over the years, but I've never heard of a client being able to do so in Canada and those 3rd party providers had high enough fees to make it far less worthwhile than it seems.

thank goodness too - for every savvy client doing so solely to collect points, 100 others would be burying themselves in further debt...


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## HaroldCrump (Jun 10, 2009)

I pay all recurring bills with credit card, except mortgage.
Next year I will switch home & auto insurance to single payment via credit card as well.


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## RBull (Jan 20, 2013)

Eclectic12 said:


> YMMV ... the autobill mistake on my father's CC was from a *California* internet provider, where he lived in Ontario. After four or five rounds of talking to CC, then the California Internet provider, a promise of a fix/refund, the next CC statement showing the refund plus a matching new charge - he cancelled the CC.
> 
> I personally would have gone through one more round to get the annual cash back before cancelling but he'd had enough.
> 
> ...


Fortunately to date my mileage does vary. 

Would be interesting to hear more details on this. What credit card, what institution? Why did this happen? How did they get his number and how does this relate to autobill? etc


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## AltaRed (Jun 8, 2009)

RBull said:


> Would be interesting to hear more details on this. What credit card, what institution? Why did this happen? How did they get his number and how does this relate to autobill? etc


This relates to autobill if you have recurring payments automatically charged to one's credit card. I do that for everything I can, as I said earlier, but there are companies/businesses I would not do this with, e.g. gym memberships which have been notorious in the past for NOT abiding to cancelled contracts. There are blue chip companies one can trust and some of the online providers I would not trust.


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## Eclectic12 (Oct 20, 2010)

RBull said:


> Fortunately to date my mileage does vary.


Agreed ... 




RBull said:


> ... Would be interesting to hear more details on this.
> What credit card, what institution?


If I had some info that this CC/bank was any worse or better than any other then I'd consider providing it.
AFAICT, it could happen to any of them so I'd prefer not to.




RBull said:


> ... Why did this happen?


The charge & related info must have not triggered any red flags from the CC/bank's perspective ... other than that, I'm not sure how anyone except the CC/bank could find out. If there's any sort of problem on their end (particularly if they decide the cost of people stopping to use the CC outweighs the cost to fix it by a large margin ... I doubt we'll hear the details.

It's similar to my co-worker who had his bank account cleaned out while in Latin America - everything was put back without fees and when he asked how often this sort of thing happens, he was shocked that the rep told him every branch has at least one instance every month (which is why there weren't a lot of questions asked versus years ago).




RBull said:


> ... How did they get his number and how does this relate to autobill? etc


 ... no idea ... as for the autobill ... the charge recurring seemed to be an autobill setup as if it was a one time bill, the first refund should have settled the issue.


Cheers


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## RBull (Jan 20, 2013)

Eclectic12 said:


> Agreed ...
> 
> If I had some info that this CC/bank was any worse or better than any other then I'd consider providing it.
> AFAICT, it could happen to any of them so I'd prefer not to.
> ...


Thanks for the reply. Scary and very annoying stuff at the same time. It doesn't surprise me there are issues, when one considers the number of # of credit cards and transactions taking place. 



AltaRed said:


> This relates to autobill if you have recurring payments automatically charged to one's credit card. I do that for everything I can, as I said earlier, but there are companies/businesses I would not do this with, e.g. gym memberships which have been notorious in the past for NOT abiding to cancelled contracts. There are blue chip companies one can trust and some of the online providers I would not trust.


What I meant by autobill was why is this person being billed with recurring charges when they have never even dealt with the company. 

I also have been using autobill for decades now. 

Yes I agree on being selective with companies. I'm only dealing with businesses that are large and generally well regarded companies for autobill. I am aware of the gym thing. The ongoing billing thing seems to be the norm rather than the exception for that industry.


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## hedgehog885 (Dec 13, 2014)

Sorry to resurrect this post but I have a question regarding the "process" of paying bill with the credit card.

As Capital One online account does not have a payee option, how would I go about actually paying my bills with the credit card?

Thank you!


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## Guban (Jul 5, 2011)

^ For reoccurring bills, call the company that is to be paid, and give them your CC information, so they can just bill away without your intervention.

eg. Call Bell/Rogers/Telus and they would be happy to have that knowledge so that they always get paid. Watch out for the expiry dates, though. If a CC expires, and you don't get the company the updated information, you may be hit with late payment charges. Of course, Bell/Rogers/Telus may warn you in advance so that their cash flow is not interrupted.


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## hedgehog885 (Dec 13, 2014)

Thank you, Guban.

I also noticed some companies have an option to allow customers to pay online through logging on to your account.

...Just another option to mention.


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