Can You Get a Money Order With a Credit Card?

Money orders are a secure, prepaid alternative to personal checks or cash. Funds are guaranteed by the issuer at the time of purchase, unlike a personal check which draws from an account only when cashed. This prepayment makes money orders a trusted method for sending money or fulfilling payment obligations.

Obtaining Money Orders with Credit Cards

Using a credit card to purchase a money order is generally not permitted by most major retailers and financial institutions. Entities like the U.S. Postal Service (USPS), Walmart, Western Union, and MoneyGram typically restrict payment for money orders to cash or debit cards. This policy exists because a money order is considered a cash equivalent; allowing its purchase with a credit card would essentially enable a cash advance without the typical associated fees and immediate interest accrual.

While direct credit card payment for money orders is largely disallowed, an indirect method exists, though it comes with significant financial implications. This involves taking a cash advance from your credit card and then using the withdrawn cash to purchase the money order. This workaround bypasses the direct purchase restrictions but triggers the terms and fees associated with cash advances, which are distinct from standard credit card purchases. Some rare exceptions might exist where a vendor accepts a credit card directly, but these instances are uncommon and will almost certainly treat the transaction as a cash advance.

Understanding Cash Advance Implications

When a credit card transaction is classified as a cash advance, several financial consequences are activated. Credit card issuers impose specific fees for these transactions, typically ranging from 3% to 5% of the advanced amount, often with a minimum fee of around $10. For example, a $300 cash advance could incur an immediate fee of $9 to $15.

Cash advances also come with a higher Annual Percentage Rate (APR) compared to the rate applied to standard purchases. While a purchase APR might be 15% to 25%, the cash advance APR could be 20% to 30% or even higher. Interest begins accruing immediately from the transaction date, as cash advances typically do not have a grace period. This means interest charges start accumulating the moment the cash is obtained, unlike purchases where interest may be avoided if the balance is paid in full by the due date.

The use of a cash advance can impact one’s credit score through increased credit utilization. Your credit utilization ratio, which is the amount of revolving credit used compared to your total available credit, accounts for a significant portion of a FICO® credit score. A large cash advance can significantly raise this ratio, potentially causing a temporary dip in your credit score. If the balance is not paid off quickly, the elevated utilization can persist, leading to a more prolonged negative effect on the credit profile.

Alternative Payment Methods for Money Orders

Several common payment methods offer more financial prudence for obtaining money orders than using a credit card. The most straightforward approach is using cash, which is universally accepted at all money order issuing locations, including post offices, banks, and various retailers. Paying with cash avoids any additional fees or interest charges associated with credit products.

Debit cards are another widely accepted and convenient payment option for money orders. When a debit card is used, the funds are directly deducted from your linked bank account, eliminating cash advance fees and preventing interest from accruing.

Personal checks may also be accepted by some money order providers, though this can sometimes involve a waiting period for the check to clear before the money order is issued. This waiting period ensures the funds are secured before the money order becomes valid. These alternative payment methods offer clear advantages by avoiding the costly fees and interest rates inherent in credit card cash advances, providing a more economical way to secure a money order.