Radpad Review: Pay Rent With a Credit Card (2017.4 Update: Apple/Android Pay No Longer Count As Travel)

2017.4 Update: Recent data points imply that, starting from Apr 21, 2017, Radpad + Apple Pay / Android Pay no longer counts as travel purchases, and thus no longer earns 3x points on CSR/Prestige. Data points: 1, 23. If you still want to potentially earn 3x UR on Rent, check out Plastiq.

Introduction

RadPad is primarily a residential rental finder website/app that also offers the ability to pay rent with a credit or debit card. Consumers pay a standard fee of 2.99% on credit cards and either $4.95 or $9.95 on debit cards depending on whether your rent is below or above $5,000. Rent payments are sent as a check to your landlord via standard mail. More details about the rent payment service can be found here.

RadPad shutdown their rent payment service in October 2016 due to perceived cash flow issues (source 1, source 2), though officially “to focus [their] team around a few key areas of [their] business”. However, as reported by Doctor of Credit, the ability to pay rent through RadPad has returned as of March 14, 2017.

Why Do We Care?

RadPad is of interest to travel hackers due to the ability to knock out minimum spends on new credit cards while earning points or miles. RadPad also earned 3x points for “online purchases” with the Citi AT&T Access More card.

Additionally, rent payments made to RadPad through Android Pay and Apple Pay were coding as “lodging/hotel,” and therefore qualifying for “travel” bonus category spend on credit cards like the Chase Sapphire Reserve (CSR) and Citi Prestige.  As of March 20, 2017, data points suggest the CSR is still coding as “lodging/hotel” when making RadPad payments through Android or Apple Pay, and is therefore still earning 3x Ultimate Rewards per $1 spent while qualifying for the $300 annual travel credit with the CSR.

Process

RadPad generally requires you to send in a copy of your rental agreement for verification prior to processing your rent payment. My landlord agreed to accept payments via this service. If you have roommates, you can offer to pay rent for the whole house or apartment and have your roommates reimburse you directly. Additionally, you can have the payment sent to your rental address for hand-delivery to the “landlord”, which may provide a creative outlet for some using this service.

Is the 2.99% Fee Worth It?

The efficacy of earning points or miles while paying a 2.99% fee is highly dependent on your valuation of the points or miles you are earning (use our Points and Miles Values if you aren’t sure).  To me, this fee is acceptable in two scenarios:

  1. You are working towards a minimum spend (though Plastiq is a cheaper option).
  2. Your purchase codes as “online purchases” or “travel” and earns 3x Thank You Points or Ultimate Rewards, respectively.

Let’s walk through the math. Assume you are in scenario #1 and are trying to knock out the $15,000 minimum spend for 75,000 Membership Rewards (MR) points on the AMEX Business Platinum card. You will earn a total of 90,000 MR (75,000 MR signup bonus + 15,000 MR for spending $15,000) at a cost of $448.50 ($15,000 * 2.99%), meaning you are paying approximately 0.5 cents/point ($448.50*100 / 90,000). We place a value of 1.6 cents/point on MR, meaning in this situation you are buying MR at a 69% discount! If you prefer cashback, you can cash out MR at 1.25 cents/point with the AMEX Platinum for Charles Schwab for a profit of $676!

Plastiq currently offers a flat 2.5% fee when using a credit card to make bill payments, including rent. Plastiq will therefore be a lower-cost option for meeting minimum spends. Additionally, Plastiq offers a referral program that provides $400 in fee-free payment per referral.

Scenario #2 will be more subjective based on your individual point valuation. If the credit card you use codes as a bonus 3x category with RadPad and you are able to earn Citi Thank You Points (TYP) at a rate of 3 points per dollar spent, you are effectively buying points at 1 cent/point. In this case it is a good idea to use Plastiq because we can always at least use TYP at 1 cent/point.

Summary

The usefulness of RadPad for paying rent really lies in the ability to earn 3x points per dollar spent, or when meeting a minimum spend (Plastiq is still a better option for the latter). Prior to the October 2016 shutdown, RadPad offered a 1.99% fee promotion when paying rent with a MasterCard, which is obviously a great deal if coding as 3x on the Citi AT&T Access More MasterCard. Note that the AT&T Access More card is no longer available for new signups, but you can product change another Citi TYP-earning card to it.

Are you using RadPad to pay rent and earn miles and points? Let me know in the comments section!


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