One frequently asked question about money orders! Can a credit card be used to purchase or buy a money order? Continue reading to find out.
If you want to send money by mail in the safest way possible, money orders are the way to go. Money orders are also excellent modes of payment in businesses with limited payment options. But one question lingers in the minds of many people: can you buy money orders with a credit card?
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The answer is yes, but it is not as simple as that. Only a few sellers will let you use your credit card to purchase a money order. Even in this country, it can be quite costly.
When you use a credit card to purchase a money order, you must pay the associated interest rate, which however makes the entire transaction even more expensive than it should be. If you still want to use a credit card, you can do so by using specific sellers.
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Can you Buy Money Order with Credit Card?
Money orders have their place in society. It is a great alternative to sending cash in envelopes and a good way to avoid the banking system.
However, there are some excellent alternatives to purchasing a money order with a credit card:
There are a few alternatives if you want to purchase money orders with a credit card. One possibility is to use a service such as PayPal. This allows you to make online purchases without you having to enter your credit card information each time.
A prepaid debit card is another alternative. This also is a good option if you want to limit your spending because it limits the amount of money you can spend.
Lastly, one of the simplest methods to use is cash.
Whatever option you select, make sure to do your homework first! For example, there are several different prepaid debit card accounts available, so take the time to determine which is best for that task.
In addition, when purchasing a money order, ensure that it is correctly filled out. Verify the recipient's information to ensure that they are the intended recipient. We still have money order scams, so be cautious so that the money does not end up in the wrong hands.
Video Guide: Can you Buy Money Order with Credit Card?
Where Can you get a Money Order with a Credit Card?
You can currently purchase a money order with a credit card at 7-Eleven stores and Western Union. However, when a money order is charged to a credit card, the transaction is typically classified as a cash advance.
This therefore means that, you will be charged all of the interest associated with a cash advance. You will also be doing your credit score a disservice.
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Purchasing or buying a money order in cash costs not more than $5, but purchasing one with a credit card can cost more than $20.
Reasons to Use a Money Order
Check out the below and see reasons for which to use a Money order.
1. Guaranteed Payment to the Recipient
A money order ensures that the recipient will be paid. It is not the same as a check that is likely to bounce due to insufficient money or rather other factors.
The only way to ensure that the recipient receives money is to pay with a money order. All the recipient needs to do is to go and cash it.
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2. Can be Cashed in Different Locations
One of the primary reasons people use money orders is that they can be cashed in a several places. Banks, post offices, and even some grocery stores are included.
A money order may be your best alternative if you need to cash a check but do not have a bank account.
3. Safe Form of Payment
Using a money order is a safer form of payment as compared to cash. The money order must be cashed by the recipient, and they must bring out their identification when cashing out.
This therefore makes it a safer form of payment because you are less likely to send money to scammers as compared to using cash.
Downsides of Using a Money Order
Unfortunately, using a money order is not always the best alternative. One of the most serious and vital drawbacks is that they can be difficult to track. If you misplace or lose a money order, you may likely have difficulty recovering your money.
Moreover, money orders usually come with a fee that isn't cheap.
Lastly, it has a $1,000 limit. Consequently, it may not be the best alternative when sending more than $1000 to a recipient.
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Is Buying a Money Order with a Credit Card Worth It?
Buying a money order with a credit card is not actually a wise financial decision. The process ends up being expensive, and however even affects your credit score which won't be good.
Here are some reasons why you should not use a credit card to buy a money order:
1. Very Pricey
Someone may ask; Can I buy a money order with a credit card? Well, yes, you can. But it’s not cheap!
Buying a money order with a credit card is an expensive affair. This is because it’s treated as a cash advance, so it attracts all the cash advance charges.
The truth is, taking a cash advance with a credit card is expensive. So, if you can avoid it, the better for you.
2. High-interest Rates
If something happens and you are not able to pay for the cash advance immediately, the interest rate can be insanely high. Unlike making a cash purchase with your credit card, a money order accrues different kinds of fees, and the interest rates can be very high.
If you are not able to pay for it immediately, you can ruin your credit score just because of that one transaction.
3. No Grace Period
What do we mean here by No Grace Period? when you use your credit card to make cash purchases, you are given a grace period of 21 days because interests start accumulating.
With a money order, it is different. It will attract interest from day one, just like a cash advance. If you are not careful, the interest rates can become very difficult or hard to manage.
4. Detrimental to your Credit Score
Messing up your credit score can happen very fast when you use your credit card to purchase or buy a money order. It is easy to land into debt if you cannot manage the interest rates accrued by the credit card purchase of the money order.
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The combination of high interest rates and the lack of a grace period can make repayment difficult. And consequently, you will be in debt, which may likely have a great impact on your credit score.