It’s now easier to earn card points by renting. But should you do?

If you are a tenant, your rent payment is probably your biggest monthly fee. Earning credit card rewards for this expense was previously complicated and rarely worth it, but it continues to change.

The BILT Rewards program allows you to earn valuable points on rent payments. And now you don’t even need a built Mastercard to take advantage of it. Recently, the company opened the program to cardholders of Visa, MasterCard, Discover and Amex.

But there is one big “but”. Cardholders will be charged a 3% transaction fee to use third-party cards. Paying rent may not be the best move depending on the type of reward your card offers and how you use them.

We recommend that you participate in the BILT program with a credit card. You need to do math. Here are the calculations that will help you with other details you need to know:

How to earn built points with a credit card

You can earn 1x points by discovering your credit card and paying your rent from the VITA, MASTERCARD, or BILT app or website.

People with American Express credit cards will have a lower rate of return. Amex cardholders only spend one point per $2. In other words, the reward rate is virtually 0.5 times the points.

In any case, you can also earn rewards that a credit card earns with a typical purchase.

To start earning Bilt Rewards this way, you will need to link your credit card to your Bilt account. You can do this in the wallet tablet of your built app or website.

Do I need to link my credit card to my Bilt account?

So let’s get to know the maths you need to determine if it’s worth paying rent with a credit card via Bilt. To do this, you will need to calculate the total value you will receive from both the card rewards and BILT points and subtract the 3% transaction fee. As an example of this calculation, we use several different card types.

Cashback Card

Let’s say you pay $1,700 per month and have a cashback card that earns 1% outside of the bonus category. For example, for example, Discover IT® Cashback or Bank of America® Customized Cash Reward Credit Card (visa).

Connect your card to your Bilt account and you will pay a $51 fee for rent payments. So you earn about $18 in cashback and 1,700 build points. According to the Bankrate rating, each build point is worth 2.1 cents. This means you get a value of nearly $36 from the build points and a total of $54. That’s barely enough to compensate for the transaction fee. Also, given the fluctuating value of build points, it is not always possible to offset the fees if they vary based on how you redeem them.

If you have a flat-land cashback card, the photos look a little different. for example, City Double Cash® Card (MasterCard) Earn 2% cashback when you purchase. You earn 1% when you buy and 1% when you pay it back. In our example, we would earn $35 in cashback and a potential total of $71. Subtracting the $51 fee will give you $20 per month.

Here is a breakdown of the mathematics I’ve done so far to help with visualization.

Remuneration value based on rent payment of $1,700 and transaction fee of $51

Travel Card

Mathematics becomes more complicated with travel cards. In many travel reward programs, the value of points or miles varies greatly based on how you redeem them. You can usually get a value for 1 cent when you go through the publisher’s travel portal. The numbers in this situation work in the same way as the 1% cashback calculation above.

However, if you forward the reward to the right transfer partner, you may be able to move on. for example, Chase SapphirePreferred® Card,Bankrate ratings show that your points are worth about 2 cents each. Again, it’s worth $20 a month. That said, you need to strategically choose your transfer partner and stick to these high-value redemptions. That may not always be realistic and be too much effort for an extra $240 a year.

A better option here Capital One Venture X Rewards Credit Card Earn double miles on every purchase. Even if you redeem your publisher’s portal, you can still get $20 a month worth without any additional strategies. And if you transfer your miles, you may get an even better deal. If transferred to a valuable partner, we are rated one mile for 1.7 cents. This means you can earn $60 per month from your Venture X Card. This is $96 when combined with Bilt Rewards, or $45 after the transaction fee.

Remuneration value based on rent payment of $1,700 and transaction fee of $51

AMEX Card

Even if you have an American Express cashback or travel card, it’s not worth paying rent through Bilt. You can only earn 1x points per $2, so you cannot collect your transaction fees.

Let’s use the example again. If you pay $1,700 in monthly rent, you can earn under $9 a month with your Amex Cash Back card. Adding Bilt Rewards will earn you $45. This doesn’t even make up for the $51 transaction fee.

American Express membership reward points are extremely valuable when transferred to the right travel partner. You can earn 2 cents each based on your bank rate rating. A rent payment of $1,700 (a $51 fee) will earn 876 points, potentially worth $18. Including Bilt Rewards, it totals $51. Again, that’s barely enough to cover transaction fees.

Remuneration value based on rent payment of $1,700 and transaction fee of $51

Conclusion

Unless you have a credit card that earns at least 2% cashback or double miles or points, you will likely have a hard time offsetting your 3% transaction fee. This is especially true for AMEX cardholders who are most likely to lose money in these transactions.

After all, one of the main draws for Bilt MasterCard is that there are no such fees. Without this feature, paying rent with a credit card is rarely worth it. Even if additional rewards are added to the mix.