Great job thinking about using a credit card to charge all your home remodeling and expansion expenses on to earn rewards points. Home remodeling can get very expensive, so you might as well try to get some freebies along the way. Using one of the best credit cards for home remodeling can help you earn rewards fast.
As a homeowner of multiple properties in San Francisco, Honolulu, and Lake Tahoe, I know the importance of home maintenance and remodeling to get top dollar for resale. I also appreciate a quality remodel that improves livability. A great home remodel is all about the details.
You will make the biggest return on your home remodeling if you can expand the inhabitable area of your home. In more expensive cities, it makes absolute sense to build down, up, and out.
For example, in San Francisco, you can build for $400/sqft and sell your property for $1,000+/sqft. That is the best arbitrage you can find.
I've remodeled multiple properties since 2003 and have always used a rewards credit card to charge all my costs. In this post, I'd like to highlight the top credit cards to use when remodeling or expanding your home.
Best Credit Cards For Home Remodeling
The best home improvement credit cards have the best welcome bonuses, the best cash back rewards, and 0% introductory APR offers.
It's a good idea to put everything from the marble slab to the 8-burner range on your credit card to maximize those rewards points.
When it comes to home remodeling, mentally budget for the project to take at least 30% longer and cost at least 30% more than expected. If you do, you'll be better mentally prepared.
While you're in the middle of remodeling, it can be very stressful. Just know that once the process is done, it'll be one of the best things you could ever do.
After spending hours reviewing dozens of credit cards, here are my picks for the best home remodeling credit cards out there today.
1) Chase Freedom Unlimited
Great Introductory Offer
Chase Freedom Unlimited is one of our favorite cards because you get an introductory 0% APR for the first 15 months. My home remodel in 2019 required purchasing $50,000 in materials. Having a 15 month buffer with no interest is huge for those who need it.
Awesome Cash Back
Further, Chase is currently offering unlimited 1.5% cash back on all purchases you make using your card. That's a great way to earn rewards while you remodel the master bathroom and spruce up the kitchen.
If you spent $50,000 on materials remodeling like I did, you would receive $750 in cash back. That's great money to put towards appliances, furniture, a new vacuum cleaner, you name it.
The Chase Freedom Unlimited card also generates points for travel, gift cards at Home Depot and Amazon, and more.
Excellent Protection
As a cardholder, you also get access to Credit Journey which gives you unlimited access to your credit score. It's free, even if you are not a Chase customer, and updates weekly. Checking your score does not affect your credit.
Zero Liability Protection means you won't be held responsible for unauthorized charges made with your card or account information.
Purchase Protection also covers your new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account.
Extended Warranty Protection extends the time period of products' U.S. manufacturer’s warranty by an additional year, on eligible warranties of three years or less.
Finally, there is no annual fee. Got to love that.
2) Chase Freedom Flex
Ultimate Rewards
The Chase Freedom Flex credit card is like the Chase Freedom Unlimited's little brother. You get to earn $200 in Chase Ultimate Rewards points when you spend just $500 on home improvements in the first three months of becoming a cardmember.
Heck, buying fixtures like shelves, toilet paper holders, hooks, and a vanity for one bathroom alone is way more than $500. Getting 40% cash back on $500 is huge!
Excellent Cash Back
Further, you also get an impressive 5% cash back on rotating categories such as gasoline, groceries, department stores, streaming services, and restaurants up to $1,500 each quarter. Just make sure you keep track of the rotating categories.
Great Introductory Offer
What's more, you also get a 0% Introductory APR period for 15 months, which is great to remodel your kitchen, bathrooms, and so forth. Let's say you're budgeting $10,000 for home remodeling. You can pay the $10,000 off by just paying $667 a month for 15 months with no interest. Not bad!
Outside of the quarterly incentives, you’ll also earn an unlimited 1% cash back automatically on every other purchase you make.
Excellent Protection
As a cardholder, you also get access to Credit Journey which gives you unlimited access to your credit score. It's free, even if you are not a Chase customer, and updates weekly. Checking your score does not affect your credit.
Zero Liability Protection means you won't be held responsible for unauthorized charges made with your card or account information.
Purchase Protection covers your new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account.
Extended Warranty Protection extends the time period of products' U.S. manufacturer’s warranty by an additional year, on eligible warranties of three years or less.
Finally, there is no annual fee for the Chase Freedom Flex credit card either.
3) Capital One Quicksilver Cash Rewards Credit Card
Capital One is one of my favorite credit card companies because that is their speciality – creating the best credit cards to fit your lifestyle. And my favorite credit card by my favorite credit card-focused company is the Capital One Quicksilver Rewards Credit Card.
Great Welcome Bonus
The Capital One Quicksilver card only requires spending $500 within the first three months from account opening to get a $200 early spend bonus. That’s a 40% bonus, and one of the highest, if not the highest, cash back rewards percentages you’ll see on the market today.
Other cards with $95 annual fees will require you to spend $3,000 and sometimes $5,000 in the first several months to get a similar bonus or less.
No Cash Back Redemption Minimum
Holders of the Capital One Quicksilver card earn unlimited 1.5% cash back on all spending. With no revolving categories, you don't have to think about which credit card to use when. You can charge all expenses on your Quicksilver card with confidence and simplicity.
Instead of having to wait until you get to a certain cash back threshold, like $100, you can redeem your cash back rewards at any time. In other words, your rewards points offer the ultimate flexibility. How annoying would it be to have to wait until you spend $6,666.70 to get $100 in cash back rewards?
No Annual Fee
A typical annual fee for a rewards credit card of Quicksilver’s caliber is $95 a year. The problem with paying an annual fee is that you are often more incentivized to use the credit card when it’s not in your best financial interest.
So you're in luck that the Quicksilver card has $0 annual fee. You won't feel the need to spend more to save more.
Get A Credit Card For Home Remodeling
Home remodeling and expansion can get very expensive. But Americans spend billions of dollars on home remodeling each year because it's worth it.
All big expenses should be charged on a credit card. Besides paying for college tuition and cars, home remodeling expenses ranks right up there.
The key is to take advantage of rewards credit cards and not let rewards cards take advantage of you. Never carry a revolving credit card balance after the introductory 0% APR period is over. Always pay off your credit card each month given credit card rates are average over 15% nowadays.
Financing your home renovation with a 0% APR for 12-15 months is a smart way to go. The more you can keep costs down, the higher your profits in the future if you ever sell.
Invest In Real Estate Wisely
Real estate is my favorite asset class to build wealth. I've made millions from real estate since 2003, and plan to make millions more over the next several decades.
One thing you should also consider is investing in real estate crowdfunding to take advantage of lower valuations and higher cap rates in the heartland of America. Real estate has performed well and is less volatile as well. The March 2020 32% sell-off in the S&P 500 was frightening!
After selling one of my SF rental properties for 30X annual gross rent in 2017, I reinvested $550,000 into real estate crowdfunding across 18 different commercial real estate properties across the country.
I'm earning income passively instead of having to deal with maintenance issues and tenants. Further, I'm taking advantage of a long-term demographic shift towards lower cost areas of the country thanks to technology.
My favorite real estate crowdfunding platform is Fundrise. They started in 2012 and are the most innovate, best-funded, and well-vetted platforms today. You can sign up and explore for free.
About the Author: Sam worked in investment banking at Goldman Sachs and Credit Suisse for 13 years. He received his undergraduate degree in Economics from The College of William & Mary and got his MBA from UC Berkeley. In 2012, Sam was able to retire at the age of 34 largely due to his investments that now generate roughly $250,000 a year in passive income. He spends time playing tennis, taking care of his family, investing in real estate, and writing online to help others achieve financial freedom too.