Can you make a payment on a line of credit with a credit card?

Using a Credit Card to Pay Down a Line of Credit

A line of credit (LOC) and a credit card are both revolving credit accounts, meaning you can borrow up to a certain limit and repay the balance over time. However, there are some key differences between the two accounts, including the interest rates and fees.

In general, LOCs have lower interest rates than credit cards. However, credit cards often offer rewards, such as cash back or points, that can offset the higher interest rates.

If you’re considering using a credit card to pay down a LOC, there are a few things to keep in mind:

• The interest rates: The interest rate on your credit card will likely be higher than the interest rate on your LOC. This means that you’ll pay more in interest if you use a credit card to pay down your LOC.
• The fees: Credit cards typically have annual fees and other fees, such as balance transfer fees. These fees can add up over time, so it’s important to factor them into your decision.
• Your credit utilization ratio: Your credit utilization ratio is the amount of credit you’re using compared to your total credit limit. Using a credit card to pay down a LOC can increase your credit utilization ratio, which can negatively impact your credit score.

Overall, using a credit card to pay down a LOC can be a good strategy if you’re able to take advantage of the rewards and keep your credit utilization ratio low. However, it’s important to carefully consider the interest rates and fees involved to ensure this strategy doesn’t inadvertently increase your overall debt burden.