I logged on today to make a student loan payment on ECSI and went directly to “make credit card payment.” Usually when I do this, I’m redirected to Official Payments, a site that allows you to make payments on everything ranging from taxes, to court fees, citations, and student loans. Official Payments only accepts MasterCard and tacks on a 4.95% “convenience fee.”
I always found this obnoxious, since I would only earn 1 point per $1, and this fee completely devalued any points I earned for my payments.
Not only is ECSI now cutting out the middleman by allowing you to make payments directly, they have decreased their fees to 3% and are now accepting Visa and American Express!
That 3% fee might still seem like a hindrance, but I was able to offset this and earn more than the standard 1 point per $1 I was previously restricted to. Here’s how:
- Buy an American Express prepaid card (Note: Amex frequently offers a $25 bonus per $200 loaded on new cards, so I’d wait for that promo if you’re not in a rush).
- Buy Vanilla Reload cards at Office Depot, using your Chase Ink Classic, Ink Bold, or Ink Plus Business Cards. Vanilla Reload cards have a $3.95 fee, but this is offset somewhat by purchasing them in $500 increments and using one of the Ink cards, which award 5 points per $1 at office supply stores.
- Load your Vanilla Reload card onto your American Express Prepaid.
- Make your student loan payments through ECSI using your American Express Prepaid card.
- Earn 5 points per $1 on your payment!
On a $500 payment, you’ll pay $15 in transaction fees, $3.95 for the Vanilla Reload card, and 2500 Ultimate Rewards points. The fees are offset with the $25 bonus from American Express, and you come ahead with $6!
If you were to do this without the $25 bonus from American Express, you’d be paying $18.95 in fees to accrue 2500 points. 2500 Ultimate Rewards points are worth $25 cash or $31.25 in free travel through Chase. You can get even more value by transferring those points to participating Ultimate Rewards partners.
While it isn’t ideal to pay transaction fees, this is a good way to meet credit card spending requirements and earn points on a payment that you have to make every month anyway.
Do you know of a cheaper way to earn points on student loan payments? Share below!
Disclosure: I do not earn a referral for any of the credit card links in this post.
I am sorry but your math is all wrong here. When you buy a $500 reload card from OD, you get 5X per dollar spent (2500 UR points). At minimum that is $25 if you choose to convert them to cash through Chase.
Now you pay $15 to the school and almost $4 to OD which comes to a total of $19. But you earned $25 from purchasing the reload card so you are still ahead $6.
You are actually paying less than a penny per UR point.
@ Dee, thanks for the heads up! I wrote this post pretty late, so my math was definitely off. I’ve made some revisions.
Thank you for this! I am currently trying to meet a minimum spend on my AE card, so even without going the extra mile, this is helpful to me!
@ Nikki, glad you found it useful! As someone who recently had to spend $18,000 in just 3 months, I know all about tough spending requirements. Luckily, there are tons of relatively cheap ways to meet them. You can even pay your mortgage with a credit card, which I will post about shortly.
I want to apply for a Chase Sapphire credit card and make my min spend ($4000) for the 50000 UR points by making payments to ECSI using the credit card. Chase says that if ECSI considers it a “purchase” loan payments will count toward the $4000, but if ECSI considers payments a “cash advance” they won’t count toward the bonus. If anyone has made payments using a card, would someone please check how ECSI reports credit card payments?
Thanks.
P.S. I think their convenience fee system is ridiculous and awful, but I could come out ahead by at least $300 if I can do this.
I have done it, though I can’t remember exactly how it was processed. I will give it a try before next week’s due date (email me if I don’t end up providing an update here).