Author Topic: Pay off SLs using CC for travel points?  (Read 2846 times)

NonprofitER

  • Stubble
  • **
  • Posts: 127
  • Location: Texas
  • Reaching FIRE w/ High Purpose (Low Pay) Nonprofit
Pay off SLs using CC for travel points?
« on: June 05, 2014, 09:51:18 AM »
Sorry if this has been asked before - I searched but couldn't find anything on the thread and googe turns up mixed results.

We're about to pay off a $5,000 student loan (in full) and will pay off another $6,000 next month.  The money is already in the bank, so there's no risk of revolving debt.  The student loans are accruing 6.8% interest - standard US government loans.  These are the last our pants on fire debts.   

Is there a way to pay them off with a points CC and then wipe the cards immediately to gain access to some easy travel points?  We're planning a big (possibly RTW) trip in the next few years and it seems like we should reap the benefits of points while we're planning on paying off big chunks anyway?

Any recommendations?  I'm not sure government loans are even payable by CC, but maybe a CC cash out/ check would be worth the fee in this case?

Any experiences with this strategy?

shotgunwilly

  • Pencil Stache
  • ****
  • Posts: 547
Re: Pay off SLs using CC for travel points?
« Reply #1 on: June 05, 2014, 10:00:17 AM »
Unfortunately, I do not think it is going to be worth the trouble unless you could just pay the loans directly with the CC (I doubt you can.)

There is a way using Bluebird and Vanilla Reloads, but not worth the hassle IMO.

frugaliknowit

  • Handlebar Stache
  • *****
  • Posts: 1605
Re: Pay off SLs using CC for travel points?
« Reply #2 on: June 05, 2014, 10:13:43 AM »
Contact whoever services these loans and ask them if you can pay them off by cc.  My guess is either no or yes, but with a big fat fee (which would make it not worthwhile).

boarder42

  • Walrus Stache
  • *******
  • Posts: 7854
Re: Pay off SLs using CC for travel points?
« Reply #3 on: June 05, 2014, 10:15:22 AM »
BB and vanilla reloads no longer work.  CVS shutdown the ability to use CC to buy them now

shotgunwilly

  • Pencil Stache
  • ****
  • Posts: 547
Re: Pay off SLs using CC for travel points?
« Reply #4 on: June 05, 2014, 10:24:26 AM »
BB and vanilla reloads no longer work.  CVS shutdown the ability to use CC to buy them now

When did this take affect? Curious because I did it about 2 months ago.

PencilThinMustache

  • 5 O'Clock Shadow
  • *
  • Posts: 37
Re: Pay off SLs using CC for travel points?
« Reply #5 on: June 05, 2014, 01:27:07 PM »
Is there a way to pay them off with a points CC and then wipe the cards immediately to gain access to some easy travel points?  We're planning a big (possibly RTW) trip in the next few years and it seems like we should reap the benefits of points while we're planning on paying off big chunks anyway?

This is a great thought.  I do have experience with this strategy, and I'm happy to report it got me the better part of a free ticket to Italy when I was a student with zero income.  This was about 7 years ago and my direct lender (the university) actually allowed payments towards tuition or loans online via CC with NO FEES.  Hard to believe since I think Visa charges them like 3%...In any event, they still allow payment by CC but they will pass along the CC 3% fee to you.

I agree that you would just have to check with your servicer to see what type of fee will be charged.  If you find out they don't, lucky you!

Jags4186

  • Pencil Stache
  • ****
  • Posts: 596
Re: Pay off SLs using CC for travel points?
« Reply #6 on: June 05, 2014, 03:55:07 PM »
I'm shocked you can pay SLs with CC. Makes me think that if your swamped with 100k in student loans you should pay it all off with CCs and file bankruptcy.

Fuzz

  • Bristles
  • ***
  • Posts: 311
Re: Pay off SLs using CC for travel points?
« Reply #7 on: June 08, 2014, 11:32:07 AM »
There was a deal where Capitol One let me write a 0 fee check against my credit card balance (normally a 2% cost) and Chase Slate let me transfer a balance with a 0 percent fee at 0 percent interest for one year (normally 3 percent balance transfer fee).

So I wrote the capitol one check for the balance on the card to myself. Paid my student loan. Then transferred the balance to the Slate card. That was 9 months ago and I'll have that zero percent card paid off when it comes due. I figured it saved me around $480 for the hassle.

As far as the points, I think you'd need to do a card where you could write a check and get points (most don't allow it) and then transfer the card to a zero percent/zero transfer fee card. Seems possible. Google is your friend.
 

blackomen

  • Stubble
  • **
  • Posts: 166
  • Location: Former Californian in Dallas
  • Antifragile since 1983
    • Optimize Myself!
Re: Pay off SLs using CC for travel points?
« Reply #8 on: June 08, 2014, 01:30:28 PM »
Load $500 onto VISA debit cards from any store and transfer the debit cards to a Bluebird account at Walmart..  then use Bluebird to pay your Student Loan lender (I think Sallie Mae is listed as one of the payees in the system.)

I think it's worth the hassle if you've got lots of credit cards with great sign-in bonuses and you're trying to meet them (i.e. get 40,000 miles by spending $2000 in the first 3 months)  But earning 1-2 miles or cents per dollar?  Forget it, you probably will barely make back the initial cost of the card this way.