Posted by Chuck on June 12, 2017
Manufactured Spending

Published on June 12th, 2017 | by Chuck

69

Visa Cards No Longer Work to Pay Mortgage with Plastiq

Life comes at you fast.

Last week we reported that Plastiq no longer codes at 3x with CSR for rent and mortgage payments. CIP had mixed data points, and even one data point today suggesting that CIP is fixed and coding at 3x again. We still don’t know about Capital One and Bank of America.

However, Visa just informed Plastiq that they can no longer process mortgage payments. Reportedly, rent payments are not affected by the change, only mortgage.

I’ll hazard a guess that mortgage payments sent out via check (e.g. small banks) will still work since the mortgage category is bundled together with rent and real estate, so there isn’t any way for Visa to see which one it is.

[Update: Reports in the comments indicate that rent and HOA can also be affected with this issue. And check-payees are also affected.]

If you can’t pay your mortgage or rent with a Visa, then the CIP question is moot since it’s a Visa card. (Same for the BofA TR question and the Cap1 Venture question since those are also both Visa cards, I believe.) Still matters for rent payments, however.

If you have a scheduled payment, it will reportedly continue processing on the Visa card so long as you don’t make any changes.

Hat tip to redbluefire on Reddit



69 Responses to Visa Cards No Longer Work to Pay Mortgage with Plastiq

  1. Max says:

    Can someone explain why this is happening? Why is this so complicated? Surely Plastiq’s business model is: accept a payment with a credit card, take that cash infusion (passing the interchange fees onto the customer and keeping a bit as profit) and then forwarding it in cash… to anything? Why does it matter whether it’s a person, business or mortgage?

    • Chris says:

      If I read it right, it’s Visa making the change, not Plastiq, for what that’s worth. But I wouldn’t be surprised if the gigantic points bill Chase has incurred due to the 3X “travel” coding played a role.

      • Tom says:

        And let’s be real here, for a minute… paying a mortgage or rent via Plastiq never SHOULD have coded as travel… it was certainly nice when it did, but no reasonable person can argue that it should be considered a legitimate travel expense. Plastiq was likely playing games with the merchant charge codes hoping to entice more people to use their service, knowing full well that there are tons of cards that earn 3x on travel, and Chase/VISA caught on VERY quickly. It’s funny how Shittybank never really caught on, but Chase caught on within a month or two… regardless of who is truly at “fault” here for fixing the incorrect merchant code, it definitely sucks and it shows how unreliable these bill payment services can be… I would’ve preferred they just left it alone at 1x so we could continue to use the service for legitimate minimum spend requirements…

        • Jim says:

          Perhaps it’s not due to the coding issue at all, and rather people abusing the system with VGCs.

          • Tom says:

            Perhaps, but honestly I don’t see how that’s considered “abuse” when plastiq is actual, legitimate spending, and you are paying a fixed percentage for the privilege of using their service. I haven’t had a need to unload VGC’s myself with plastiq so I’m not sure if they are currently coding at the 1% debit rate or the 2.5% VISA rate, but if VISA was losing too much money on this, I’m sure they could’ve somehow blocked these plastiq payments on the VGCs only and forced them to go through as credit transactions for higher interchange rates… Mastercard gift cards, for example, don’t work as debit in many “conventional” places, but seem to work fine as credit in many of those same places. I’d bet Chase had a major impact in this decision, considering how many rewards they likely paid out due to 3x plastiq in the past 2 months, since Chase and VISA are so tight.

        • TG says:

          Citi never had anything to catch on to. It never coded as travel for MC

          • Tom says:

            Lol, not necessarily travel perhaps, but there definitely was something to “catch on to”.. but you know how stupid they are…

        • I can see why it might code as lodging and why lodging would code as travel, don’t think it’s that crazy.

          • AjC says:

            I pay my rent through a fairly common online portal used by apartments – last week there was the option to pay via Visa, MC or Discover, but the option to pay using a Visa card has disappeared this week. I find it hard to believe that these situations are unrelated, so it seems like Visa may be trying to cut out more than just transactions that might quote as lodging.

  2. chaseaholic says:

    Had a first ever decline using a VGC to pay rent via plastiq w/ msg stating to contact my card issuer because they were blocking it.

    Possibly related?

    literally made similar payment ~ 2 weeks ago, same amount, same store/vgc.

    • Jimmy Deals says:

      I had the same issue. Metabank VGC to pay HOA declined with same message to contact card issuer. Don’t waste your time calling # on back of VGC as I couldn’t get anywhere after 45 min.

      • Chuck says:

        Thanks for the data points. Seems rent/HOA is also affected.

        Funny, I actually wrote that in an earlier draft of this post that logically it’ll be all the same since Plastiq bundles rent and mortgage categories together. But then I saw the Reddit report indicating otherwise.

        I’ll update.

  3. Tom says:

    So many shenanigans with Plastiq lately, it used to be so reliable… I hope we don’t have another Radpad-esque incident. Considering switching back to auto-draft payments by my bank until the dust settles, not worth missing a mortgage payment over a few points. Thanks for the heads up Doc.

  4. Frito Pendejo says:

    This seems like it would be a huge blow to plastiq’s business.

  5. Ferris says:

    No big deal, just buy Mastercard or AMEX GCs instead. Went to my grocery store are there are 10 racks of $20-500 MC, Visa, AMEX split evenly.

    Only bad thing is meeting spend for Visa cards. I may just send checks addressed to my credit union.

    • Tom says:

      Be EXTRA careful with the Mastercards though, they are known to be subject to fraud much more frequently… unload them as soon as you activate.

      • artgriego says:

        Which grocery store’s/bank’s MGC are you referring to? There was a problem with Ralph’s VGC a year ago but I haven’t heard anything about other specific flavors being especially subject to fraud.

    • mangina says:

      Don’t those MCGC and AGC code as credit on Plastiq though? So you’d be paying a pretty high fee to plastiq, in addition to the activation fees just to put some spend on a Visa CC.

  6. Jay says:

    “I’ll hazard a guess that mortgage payments sent out via check (e.g. small banks) will still work since the mortgage category is bundled together with rent and real estate, so there isn’t any way for Visa to see which one it is.”

    Would just like to point out that many payments to big banks are also deliverable via check only as well, and that snail-mail check delivery does not mean that Visa will be accepted.

    For example, I tested it out with my Wells Fargo mortgage recipient, which can only be paid via check, and the same error message appeared (which also removed the ability to click the “Submit Payment” button).

  7. Ven says:

    so any other options to pay mortgage other than plastiq.

    appreciate any help on this. I just got CSP and was planning to use plastiq.

    • Bill says:

      There are lots of uses for the CSP/CSR/CIP other than Plastiq. The cards are very useful for their Primary CDW when you rent a car, and no FTF if you travel to Canada or other international destinations.

      If you obtained the cards solely for Plastiq, this is a major bummer.

    • Chuck says:

      Ven, I can’t think of anything OTTOMH for mortgage.

    • John says:

      What about Tio (formerly ChargeSmart)? I’ve never used it before, but thinking I may need to now.

      • Chuck says:

        They do support some things. The biggest issue there is that their fee is 3.5%, I think?

        • Avi says:

          I’d never heard of Tio, but just gave it a try for my mortgage payment because I have to meet the minimum spend for my new Marriott card and had been counting on Plastiq to do that. The fee oddly came out to a very random % just under 2.63%. Will report back on how smoothly it posts.

        • Avi says:

          My Tio payment was rejected because they only support regular bank loans for my bank, not mortgage payments. Oh well.

      • Ven says:

        Thanks John. I will give a try with Tio on my mortgage and I know fee is little higher but I could use for a month or so.

  8. Zack says:

    So if there’s a DP saying it’s back to 3x for CIP but no more Visa for mortgage payments, but if you have auto payment set up within plastiq it will still work. Does that mean if you still have auto payments on CIP and leave it untouched, those will be 3x? 😛

  9. Nun says:

    What about Ink Bold Mastercard? Did any MC ever code as travel?

  10. Jay says:

    What about CSR for rent? Is that back to coding 3x?

  11. Darv says:

    The inkling here seems to be Plastiq getting cute with merchant code. Doesn’t make sense to be punitive here by Visa. As long as these charges code appropriately, makes no sense to restrict one type of expense.

    Hopefully Plastiq can work out of the doghouse. I think they’ve otherwise built a good business. Hopefully Visa reconsiders. I get the 2x and 3x perceived abuse, but don’t understand blocking 1x.

    I have two mortgages. One went through this evening with CIP, the other denied. Plastiq might be working through these payees manually.

    • Eddie says:

      I am guessing it is related to fraud with large transaction amount. I discovered I could not pay mortgage with visa card on Saturday and I was hoping it is due to Plastiq fixing the coding issue. Feeling so bad that now the option paying with Visa is gone.

  12. Darv says:

    But there’s no fraud. It would seem to be a coding issue, pure and simple. No other reason for this. I don’t see how Plastiq transactions are risky for Visa or issuers. This might just be retaliation by Visa against Plastiq for greasing the code in favor of its users.

  13. Miles says:

    I have been using plastiq to pay mortgage with AMEX or MC. They were never coded as travel. Visa issuers got fed up with paying extra points for non-travel purchase!

  14. Ian says:

    I don’t understand why the CSR would no longer code as 3x but it would for the CIP. They are both Visa cards so they should use the same MCC system. Is Plastiq is coding as something like internet services that would get 3x on the CIP but not the CSR?

  15. bY says:

    Just received an email from Citi that starting 7/22/17 my ATT Access more card will no longer receive 3x on rental and real estate payments and also gift cards.

    Perhaps related to Plastiq?

  16. Bill says:

    Citi just sent out an email that points earned for online purchases are changing. ” The categories eligible to earn 3x ThankYou Points for purchases made with your AT&T Access More card are being updated. Beginning July 22, 2017, you’ll only receive 1 point, not 3x points, for every $1 spent online on the purchase or reloading of gift cards or on rental and real estate payments.”

    I expect Plastiq usage to drop dramatically.

  17. chenyuetian says:

    Just got this from Citi: The categories eligible to earn 3x ThankYou Points for purchases made with your AT&T Access More card are being updated. Beginning July 22, 2017, you’ll only receive 1 point, not 3x points, for every $1 spent online on the purchase or reloading of gift cards or on rental and real estate payments.
    So to me, I won’t use Plastiq unless there is another card steps in and fill the hole.

  18. paul smith says:

    I did a mortgage payment to NationStar with my CIP on 6/8/17, coded as travel, received 3x.
    Capital one Auto on 6/6/17, also coded as travel

  19. Rob says:

    Paid Bofa mortgage $100 using CIP ON 6/10. codes as travel 3x.

    Made another yesterday for rent $3k. Will let you know how it codes using CIP

    • Rob says:

      Posted. Coded as 3x for my rent payment. Made another 5k Payment for my mortgage BofA today. Let’s see how that goes. But Visa restrictions doesn’t seem to be for everyone.

  20. Mike says:

    Just used my CIP that is a Visa to send my mortgage payment to my Credit Union. Worked just like before.

    • Sorry what comment are you trying to point me in the direction of?

      • shaky02dd says:

        I assume it’s this series of comments beginning on June 7:

        “Today I tried to pay estimated taxes via Official Payments with OV prepaid cards. I have been doing this for several years with no problems. Today the payments were rejected and was told it is an issue with the card. The OV site shows the card is loaded.
        I was able to use the same OV card to pay at PayUSAtax, so it appears to be an issue with Official Payments.”

        (I also ran into the same problem myself trying to use metabank GC’s from Staples to pay parts of my estimated taxes for this quarter, so I was looking for this info — official payments denied the cards.)

  21. Andrew says:

    Did a test payment on 6/12 using my CIP to pay my mortgage company (small CU in FL). Payment coded as 3x. Paid the same entity (via CIP) on 6/6 and it coded as 1x. In previous months, it coded as 3x (also with CIP). Strange.

    • shaky02dd says:

      Sorry, just want to make sure I’m not confused by the order:

      You paid last month on 5/X, coded as 3x
      You paid some amount on 6/6, coded as 1x
      then you paid a small amount on 6/12, coded as 3x?

    • Alex Buz says:

      Thanks for the DP. With CIP, I’ve gotten 1x on a mortgage payment that I made on 6/3, but last month is was 3x. Next payment hits 7/3 and I’m wondering whether it’s going to be 1x or 3x. Too bad no way right now to send a small payment to check.

  22. Sam says:

    DP : Tried to pay PHH Mortgage with CIP – Plastiq won’t allow it anymore. Had done it last month.

  23. paul smith says:

    7/4/17 Capital One Auto finance posted as travel
    7/6/17 Rent posted as insurance

    This is on Chase Ink Preferred. Last month they both posted as travel

  24. Flame says:

    Anyone – Are you in touch with Plastiq? Have not seen them come up with any new promotions. Was expecting a promotion last month which was their anniversary. Now with Visa payments not going through Mortgage, they must be seeing some major volume go down. Anyone in touch with their management and if they have any promotions planned soon?

  25. HarryTheFirstHarry says:

    They have gone rogue. Charged me for waived fee after 3 months.

  26. Darv says:

    Sounds like it’s over for Amex with paying mortgages through Plastiq.

    Why has there not been coverage of Tio here? I haven’t used them but need to pay mortgages to meet minimum spends. A review would be greatly appreciated, gentleman.

    According to Tio’s website, both of my mortgage companies are available as billers. Maybe if you do a review we can get some data points.

    Thank you!

  27. Rigo Leto says:

    Weird, Plastiq is allowing me to schedule a payment to Chase for my mortgage payment with a Visa card today.

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