The Best Credit Cards for Real Estate Investing

What type of credit card is best for real estate usage? I’m going to cover anything related to 0% credit cards. Credit cards will give you the best perks in signup bonuses or mileage, which ones are my favorite.

There are two types of credit cards. We have a 0% credit card, and we will have the ones with signup bonuses. What’s the benefit of having a 0% credit card? Well, you can accumulate debt, and you pay in a flat fee. If your credit limit is $5,000 on a credit card, you can use up to all $5,000 without having to worry about any interest added to it over a certain period. That way, you can pay it down even faster versus paying a card that every time you put in, let’s say $100, all you’re paying down it’s just maybe $50 because the remaining $50 or what you put in is going towards the interest rate.

With 0% credit cards, there’s a lot of them out there. Some of them are for six months. You will find some of them at 12 months or 18. If you’re lucky enough, you might even find one at 24-month 0% interest rates.

What’s the beauty of those signup bonuses credit cards? The way it works is that most credit cards with sign up bonuses will say, well, if you spend $1,000 for the first three months, we’re going to give you $300. If you spend $5,000 in four months, we will provide you with $700 worth of points. You can leverage the credit card to pay your day to day expenses. Let’s say your rent through Plastiq. You can take out the money from Venmo and then have someone in your family, whoever sent the money through Venmo, send you the money back.

Don’t do it right away. That’s a big no-no. Wait a couple of days and then have that person send it back to you. You can take that money, pay down that credit card, or use it with the signup bonuses. Spend the money that you need to qualify for that bonus point and transfer that money into that 0% credit card. So that way, you can pay it down even faster and not have to worry about the 10%, 15%, 20% interest rate on the credit cards.

I have on my right a list of credit cards that I find to be very useful. They’re, in fact, some of my favorites. To start-up, we’re beginning with the 0% credit cards.

best credit cards

There are two types of credit cards. We have a 0% credit card, and we will have the ones with signup bonuses.

American Express Blue Cash

The first one on the list is the American Express Blue Cash, and we’re going to hit the link right here. When you use my referral link with the American Express, you earn an additional $200 cashback. The beauty of this card is that it doesn’t have any annual fees. It’s 0% for the first 15 months. Then throughout your usage, you get benefits like 3% cashback whenever you do your grocery shopping at your supermarkets, % in cash and select department stores, and 1% cashback in any other type of purchase.

You make money as you spend money. Don’t forget to use this to cover any expenses that you would typically do regularly. Like, your rent, pay your bread through Plastiq, or just only having the ability to take the money out through Venmo. That never used the advance checks that they send you because the interest rate, they’re going to start kicking out right away. You can see it can range between 15.24% to 26.24%.

Then as you go along, you can see a bunch of the benefits that you get here. You get an instant reward. You can also go ahead and start referring the same credit cards to your friends and then spread the joy. You can use this for trouble benefits as well. Whatever points that you accumulate, you can apply them towards cashback, or you can also use them for trouble benefits and so on.

Some people have the preference to personally go to the bank and apply for a credit card. In my opinion, there’s no need to do that when you can do that online. It’s very simple. You get a decision as soon as 30 seconds. All you have to do is fill it up with your information, date of birth, social security, etc. 

You’re going to earn $200 in cashback as a signup bonus after you spend $1000. Spending $1,000 in three months is relatively simple. You can use Plastiq and pay your rent. For some of us, it would take one month. For some of our rent, it’s over 1000. If you have a rent that falls into the lower category, let’s say, $700 to $800 and $900, it will take you two months. It will still be relatively under these three months. Then your $200 will be issued back to you as a statement credit.

americanexpress

American Express Blue Cash

Chase Freedom

With Chase Freedom, the same thing. Once you use the link that I’ve included in the description box down below, you will get the same benefits. You’re going to get a $150 bonus after you spend $500 in purchases. That’s relatively simple. $500 can quickly be gone by your rent payment or even grocery shopping in one month, and they’re giving you three months right here, 1.5 cashback on anything that you spend, anything that you do.

As a new member, you get an additional $150 bonus for signing up and having a 0% APR. I believe I read that somewhere yesterday, yes, here. 0% for APR for the first 15 months. Suppose you have a credit card with a high balance, what you can do is simply call Chase and transfer that balance from that high percentage credit card and to this 0%, and you should be able to pay down your credit card debt even faster.

Remember, with Chase you cannot transfer balances from one Chase credit card to another. It has to be from a different bank. You can do that from a Bank of America into Chase. You can do that from a Discover card and to Chase. You kind of get the picture. 

chase-freedom

Chase Freedom

Discover

Now we’re going to move on to Discover and the same thing. When you use my link, you can get a $50 statement credit for signing up with my link, and it’s effortless. You fill it up. First and last name, and you get to pick how pretty the card is.

I prefer to wait for my credit card to arrive and then give them a call to do the balance transfer. I try to do that in the application, and in fact, that took longer to process. I think the processing time was about three weeks or so. Still, if you call the bank as soon as you get the credit card and request for a balance transfer from those high percentage interest rate cards, they, the banks took, I think an average, maybe two weeks as opposed to the three weeks that they will take when you do this from the application.

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Discover-It

Discover

Capital One

You get the application, and it looks relatively simple, very similar to the prior ones. You have to give your name, citizenship, birthday, social security, residential address, but here’s what you’re going to see a significant difference. You have to be in the rebuilding stage either with no credit or have pretty bad credit because you have a lot of debt and a lot of revolving debt. You’re going to see that the rates are relatively high 26.99, variable APR, which means it can adjust depending on your performance and the market circumstances.

Let’s say if the Federal Reserve Bank of New York decides to increase the rates. It’s not only going to impact this card but also affecting all of the credit cards. While it’s not ideal to pay this much credit, the good news is that you can only spend as much as you put in. If you make a security deposit of $49, $99, or $200, this is the maximum amount of money that you can spend. It’s going to force you to be disciplined, and it’s going to force you to make those payments on time because it’s fairly a small amount.

When you try to rebuild your credit, you have to work extra hard to be disciplined, just spend what you have, and don’t go over what you don’t have. If you plan to spend $50 in grocery shopping and have exactly $50 in cash to spend, just simply use this card, pay $49 worth of grocery, and immediately pay down the credit card. That way, you can start establishing a good credit history and show the banks that you’re making payments on time.

It is relatively easy to get compared to the Citi Diamond card. If you have the luxury to apply for both and be approved for both, go ahead and do so because the more credit cards you have, the faster you can rebuild your credit because you can build your relationship, not just with Capital One. Still, in this case, you can rebuild it with Citi, or you can start building that relationship for those who don’t have any credit history whatsoever.

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capital one

Capital One

Citi Diamond card

Same as Capital One, there’s no annual fee for this. Citi, it’s a very well known brand just as well is MasterCard. You have to deposit $200 as the minimum amount to start your credit line with Citi and, basically, the same thing.

The annual percentage rate for Citi is slightly lower than with Capital One. For those who don’t understand how credit card interest rates work, this is an annual percentage rate, which means that, on average, you’re paying 24.74% in the interest rate on average yearly. It does not necessarily mean you’re paying 24% on interest every month. It’s a breakdown of 24% divided by 12 if we divide 24.74% by 12, 2.06%.

That means that if you let’s say you owe $100 a month, right, you’re going to multiply $100 x 0.0206, which was the breakdown. 2.06% per month, which means monthly, you’re going to pay $2.6, which will make it equal to $102.6. But if you multiply that by 12, this is how much you’re going to be paying every month, which is relatively close to 24.74%. 

citi diamond

Citi Diamond Card

Chase Sapphire

Now we’re going to move on to my favorite card, and that is the Chase Sapphire. The reason why this is one of my favorite cards, even though it’s not a 0% card, is because of its signup bonus. When you use the link and apply, you get a signup bonus of up to 50,000 bonus points, equivalent to $625. It is not bad for spending $4,000 out of your pocket for something that you would typically spend anyways, meaning your rent, your electric bill, your water bill, and property taxes.

Yes, you pay a small fee, maybe a 3% or 5% depending on the type of services you’re utilizing, but let’s say totaling all fees for the 4,000, I don’t anticipate that could go higher than $100 per service. When you deduct $100 out of & 625, you’re still getting $525 back to you that you can either use for travel mileage, you can use them to pay down your card as a cashback deal, and so much more than you can do.

I know that there are a lot of perks. I’m not entirely familiar with all of them because I use Chase Sapphire to travel. That’s how I managed to go to all of those real estate events outside of my state. I’m just to travel, to meet more investors with me, like-minded individuals who are willing to partner up with me in other states. They can serve as an extra set of eyes for what I’m not around and stuff like that. Although I’ve heard, I haven’t done this yet. This will be my first year, where they will charge me $95. If I can prove that I’ve been very disciplined in paying down my cards and being on time with all the payments, you can call Chase and waive the fee again.

They’ll do it for one more time, and then by the time the third year hits, I think that’s when you will have to pay the $95. I think $95 is not bad compared to some other cards out there. For example, the American Express Gold or Platinum, I think they charge up to $450 on an annual fee, and they don’t give him the same amount of bonus points that Chase is giving you.

If you’re going to go ahead and apply for all of these credit cards, Chase has what they call a 524 rule, meaning you cannot get up for more than five credit cards from any bank in 24 months. Before you decide to apply in any of the cards, if you have good credit, I’m talking and about somewhat between 650 and above at least, if you, if you plan to get three credit cards as a first batch, make sure you get the Sapphire first, and then you get the Freedom first, and then you go ahead. You apply for the other ones, the Amex or the Discover that I suggested.

Because once you hit that five credit card mark and less than 24 months, you won’t get approved for any Chase cards anymore unless you just stop applying for new credit for the next 24 months. For you to expand your real estate portfolio, that’s very unrealistic. Make sure you get the best out of the Chase cards from the get-go because, for the next three months, you’re probably going to apply for other credit cards, and chances are you’re not going to get approved for any of the Chase ones.

chase sapphire

Chase Sapphire Preferred

Again, as a recap from prior posts, apply for three credit cards at a time, every four to six months, no more than three credit cards every four to six months. If you’re applying for a batch of three for the first time, make sure you get the Chase ones first before moving on to the next ones.

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Whenever you eat at a restaurant or purchase a plane ticket or rent a car, I believe car rentals are considered part of travel. You have to call Chase and verify, but I think they do, you get two times the points that you apply. Every time you redeem your points for mileage travel, yes, you get 25% more.

Let’s say, for example, if you were to take 50,000 points in cashback, instead of getting $625 with points, you would probably get $575 if you were to redeem that in cashback. I’m making these numbers up, but you kind of get the gist of it. If you want to milk the best out of the points, make sure you’ve redeemed them for traveling instead of like any other perks offering you like cash back or gift cards and stuff like that.

I like his card because they don’t have any transaction, zero for transaction fees. Let’s say you travel to Canada and go on a vacation to Europe or travel to South America; every time you use this card, there are no transaction fees. I can’t emphasize that enough, transaction fees are small, but if you were away for two weeks, every time you swipe a card, the fee starts going up. When you least expect it, you have spent an average of $200 just in foreign transaction fees. I like that about the Chase Sapphire that you can take that to anywhere in the world, and you will be treated as if you were swiping your card in the US.

I think that if you rent a car with Chase Sapphire, you don’t have to purchase additional insurance, like the insurance that they offer on the rental cars because Chase covers you for that. You’re going to have to call Chase to enquire about that. I’ve never actually used the services, but it’s a nice perk to have.

Other ways to get funding for Real Estate Investing

Prepaid Cards

That’s it for the 0% cards. They’re great to work with, and they could serve for people who already have established credit, people who are somewhat in between, around the 620s. That should still work for you, but if you have something lower or you’re trying to rebuild your credit or build your credit from scratch, then the cards you should go for are not these. You should start with something like the prepaid cards that I mentioned in my prior posts. The first one we’re going to cover two, Capital One and Citi Diamond prepaid cards.

Personal Loans

If you want to move ahead and apply for personal loans for those trying to rebuild their credit, you can go to Upgrade.com. Then you can go ahead and see how you can qualify. 

It is very similar to any credit card application. It is a fixed-rate, no prepayment fees. Some of them, some personal loans they like penalize you for paying off your debt early like a mortgage. I decided to go with Upgrade because I can afford to pay more monthly. If my minimum payment was like 200, I wanted to pay for 500 sometimes if I had the money, and if I were to pay the loan a lot faster, mine was for five years. But if I spent it saying three, I wouldn’t have to worry about any prepayment fees.

Another one that I mentioned in prior posts, it’s Upstart.com. When you go to Upstart, is the same thing so that you can invest, you can borrow money. You want a loan for credit cards or debt, student loans. You can do that for multiple purposes, although I don’t necessarily recommend paying off a student loan with Upstart alone because the interests are relatively high.

That should be a topic for another time, but if you want to pay off a student loan, I suggest you do that through 0% credit cards, which is the same trick. You take the money out, or you use the money to pay your rent. Then with the cash that you usually would pay your rent, you put it towards your student loan, or you can do that through Venmo and then take the excess cash and then just pay down your student loan from there and so on.

LendingClub

It is the one that everybody seems to know about, the platform that everyone goes. I’ve never used LendingClub. I think by the time I applied, the rates that I was getting through LendingClub were higher than then Upgrade. I decided I’ll go with Upgrade.

Also, I liked the fact that there are no prepayment fees. I’m not sure if LendingClub has any prepayment penalties, but hey, you have various platforms to choose from. If you’re applying with a spouse or a friend, have somebody that you trust, the same thing. I also talked about LendingTree. LendingTree.com is the same thing. Home refinancing purchase, personal loans, home equity, auto loans. You can do personal loans right here and so on. To qualify for a business loan, you have to have one of these legal entities set up. You have to have at least an LLC or a corporation or a sole proprietorship.

RESOURCES & LINKS MENTIONED IN THIS POST:

– Recommended Credit Cards: https://go.novariseinvest.com/credit-cards

– Chase Sapphire (best rewards): http://bit.ly/Sapphire-Chase

– Capital One (prepaid card): http://bit.ly/prepaid-re (to build credit)

– Citi Diamond (prepaid card): http://bit.ly/prepaidciti-re (to build credit)

– Upgrade (personal loans): https://www.upgrade.com/

– Upstart (personal loans): https://www.upstart.com/

– Lending Tree (personal loans): https://www.lendingtree.com/

– Lending Club (personal loans): https://www.lendingclub.com/

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