Can You Get a Money Order With a Credit Card?

A money order serves as a secure, prepaid payment method, functioning similarly to a personal check but with guaranteed funds. It provides a reliable way to send money or make payments, particularly when a bank account is not accessible or when enhanced security is desired for a transaction. Unlike personal checks, a money order is purchased upfront for its face value, ensuring the recipient receives the intended amount without the risk of insufficient funds. Money orders typically have a maximum limit, often around $1,000 for domestic transactions.

Using a Credit Card for a Money Order

Most vendors (post offices, major retailers, financial institutions) do not permit direct credit card purchases for money orders. This policy stems from money orders being cash equivalents; allowing credit card payments would enable cash advances without fees or interest. Therefore, locations like the U.S. Postal Service, Walmart, and Western Union typically require cash or debit card payment.

While direct credit card payment is largely prohibited, some scenarios might allow a credit card to be involved in obtaining a money order, but this usually occurs indirectly. If a credit card is accepted at all for this type of transaction, it is almost universally processed by the credit card issuer as a cash advance. This means the credit card is not used for a standard purchase but rather to withdraw funds, which are then used to purchase the money order.

Understanding Credit Card Cash Advances

A credit card cash advance is a short-term loan, borrowing money directly against the credit limit. This differs from standard credit card purchases, which involve buying goods or services. Cash advances can be obtained through ATM withdrawals (using a PIN), in-person at a bank, or by cashing convenience checks.

A primary distinction of cash advances is the absence of a grace period, meaning interest begins to accrue immediately from the transaction date. Unlike typical purchases, where interest may be avoided if the balance is paid in full, cash advances incur interest from day one. Additionally, the Annual Percentage Rate (APR) applied to cash advances is typically higher than the rate for regular purchases. Credit card issuers also often apply a separate, lower limit for cash advances compared to the overall credit limit, and these transactions generally do not earn rewards points or cash back.

Costs Associated with Cash Advances for Money Orders

Purchasing a money order via a credit card cash advance involves several fees, making it costly. First, the money order incurs a small fee from the vendor, ranging from under $1 at some retailers to a few dollars at the U.S. Postal Service, depending on the amount. For instance, USPS charges around $2.55 for money orders up to $500 and about $3.60 for those between $500.01 and $1,000.

Beyond the money order fee, the credit card issuer imposes a cash advance transaction fee, typically ranging from 3% to 5% of the advanced amount, or a flat minimum fee, often around $10, whichever is greater. Furthermore, the interest on the cash advance begins accruing immediately at a higher APR than regular purchases, often in the range of 22.99% to 27.99%. If the cash advance is obtained from an ATM, additional ATM operator fees may also apply. These combined costs significantly increase the total expense.

Alternative Payment Methods for Money Orders

For money orders, several common payment methods are widely accepted, avoiding high credit card cash advance costs. Cash and debit cards are the most universally accepted payment forms. These methods draw funds directly from a bank account or existing cash, ensuring the money order is fully funded.

Many locations, including banks, credit unions, post offices, and retailers, readily accept these payment types. Using cash or a debit card offers a straightforward, cost-effective way to obtain a money order without additional fees or higher interest rates. This approach aligns with the prepaid nature of money orders and is standard practice.