Is It Worth Paying Your Rent or Mortgage on a Credit Card?
A few months ago, LaQueshia Clemons and her husband were looking for ways to earn the most points on their credit cards. After some exploration, they decided to give Bilt
MasterCard
* bring it on.
The Bilt Mastercard is a unique housing credit card designed to help you earn rewards for paying your rent. According to a report later this year Letter to members Bilt will also offer mortgage payment points on its website. Another housing credit card, the recently launched Mesa Homeowners Visa® Signature Preferred Credit Card*, also allows homeowners to pay their mortgage with credit card points, although its terms and conditions are a little vague.
Clemons is a 35-year-old financial therapist free living therapy Based in Connecticut, Bilt cards are now used to pay for monthly rent, electric bills, cell phone bills, car insurance and streaming subscriptions. She and her husband put about $2,500 a month on their Bilt card, earning plenty of bonus points in the process.
Since housing is the largest expense for most American households, it might make sense to use a credit card to cover large ongoing expenses like rent. mortgage Payment. But is using a home credit card worth the risk? Let’s take a closer look.
Is it a good idea to pay for housing with a credit card?
It may be worthwhile to use a credit card to pay for any expense, including housing, but it always depends on your budget and spending patterns. If you’re in financial trouble due to a recent job loss or have unpaid medical bills, you don’t want your housing costs to accrue interest and put you further into the red.
However, if you’re confident that you can use the card conscientiously (meaning you can pay off your balance as soon as it’s due each month), using a credit card can be a great way to rack up points.
For example, Clemons pays off her balance every week. Part of her weekly paycheck goes directly to credit card payments, and she never accrues interest. Since her card is paid in full every month, she can earn points without being hit by high interest charges or fees.
“I can accumulate enough points to have money taken off my rent,” she said. While it may only be a few extra dollars each month, the extra money can be used to buy things like coffee on the way to work.
Beau Wirick, 38, wealth advisor Morton Fortune Living in California, he has been using Bilt cards to pay his rent for the past few years.
“Earning rental points can be a game-changer, so I recommend using a Bilt card for this purpose,” Wirick said. Wirick gets the best redemption value by transferring points and redeeming them through Bilt’s travel partners, where points can be used for flights, car rentals, hotels and activities.
What are the pitfalls of using a credit card to pay for housing?
The disadvantage of using a credit card to pay for housing is that you can accumulate more debt if you don’t have enough money each month to pay off your balance. It’s generally safer to pay for housing the traditional way, by transferring money from your bank account via ACH, writing a check, or sending a money order.
It’s also important to check the fees with your landlord or property manager. While the Bilt and Mesa cards have no annual fee (the Bilt card has no transaction fee for rent payments), your landlord may charge a processing fee if you pay with a credit card.
One way to avoid this with Bilt is to select birt protectionwhich allows you to pay rent and earn points without touching your credit limit. Through this feature, funds can be withdrawn directly from your linked bank account. If you choose not to use this feature, your rental payment will be charged directly to your Bilt Mastercard, just like any other charge on your credit card.
Are there any requirements for a housing credit card?
There are no unique requirements for a credit card used specifically to cover housing expenses. To qualify for the Bilt Mastercard, you must be 18 years of age or older and a resident of the United States or its territories. Technically, there is no minimum credit score to get approved, but the recommended score is good to excellent (670 to 850).
To earn points on your Bilt card, you need to make at least five transactions per billing cycle. To make sure you never miss that threshold, try setting your Bilt card as the default method for ongoing spending.
For Mesa cards, anyone with an eligible device (iPhone only) can join the waitlist directly, according to company representatives. Once you are invited to apply, you will be required to provide additional information in order to make a credit decision on your application, similar to other unsecured consumer credit cards.
What can you earn with a housing-specific credit card?
Birt MasterCard
birt offer Earn 1x points per $1 of rentup to 100,000 points per year. To earn points, you need to use the card at least five times during each monthly statement period. Earn higher points when you spend on travel and restaurants. As a Bilt cardholder, you can receive special benefits at partner restaurants, fitness studios and ride-sharing apps.
You can transfer points via Bilt’s tourist portal You can also earn extra points when booking travel through the portal.
In addition to improving your credit score if you make your payments on time each month, Bilt has an additional feature that allows you to choose to report your rent payments to the three credit bureaus, which can also Improve your score.
Mesa Homeowners Visa Signature Preferred Credit Card
Currently, you need to join a waitlist to sign up for the Mesa Visa card, which is only sold at the Apple Store.
Mesa credit card has different rewards Rates depend on your purchases: 1x points per $1 on monthly mortgage payments; 2x points on everyday essentials (e.g. groceries, gas); home-related transactions (e.g. utilities, maintenance, decor and Home improvement projects) earn 3x points; all other projects earn 1x points.
You’ll also enjoy other benefits, such as a Sam’s Club membership and points from Mesa brand partners like Thumbtack and Wag! Points earned can be redeemed for statement credits, gift cards, travel and mortgage loans.
What protections are there in Bilt or Mesa?
Sharing sensitive information with another party always carries risks, so it’s important to keep your account information safe.
Bilt and Mesa credit cards come with standard zero-liability protection to help keep your sensitive personal and financial data safe from fraudulent activity. Since Bilt is a co-brand of Mastercard and Wells Fargo, it comes with 24/7 identity theft protection.
“You need to make sure they have the appropriate safeguards in place to transmit your payment information to your landlord, property manager or mortgage company,” said Jovan Johnson, CFP and co-founder. part of wealth planning. “Look for additional card features, such as fraud alerts or virtual card numbers, which can add an extra layer of protection.”
Are housing credit cards worth the hype?
Each credit card has specific benefits and bonuses, so it’s a good idea to research its pros and cons before applying. Bilt has become more mature and should soon expand its reach. Mesa’s coverage is still fairly limited, so it’s worth doing more research into the terms and conditions.
Financial experts say you should only use a credit card if you can afford to pay off your bill in full and avoid carrying a balance. Otherwise, it is easy to fall into debt due to high interest rates.
“The purpose of a credit card program is to incentivize you to spend more money, period,” Wyrick said. “Anything you can do to prevent yourself from falling into bad habits, do it.”
*All information regarding the Bilt Mastercard and Mesa Homeowners Visa Signature Preferred Credit Card is collected independently by CNET and has not been reviewed by the card issuer.
