2 credit cards offer up to 5% back when you buy a new house, but there’s a catch

• The Rocket Visa Signature® Card earns 5% cash back if you use rewards toward a Rocket Mortgage down payment and closing costs.
• Bilt Rewards members earn 1 point per $2 spent on a new home when they buy with an eXp Realty agent.
• But if you don’t use these companies, you’re better off with a more flexible cash-back credit card.

If you hope to buy a home in the next year or two, you’re probably saving every spare penny toward your down payment and mortgage closing costs.

Two credit cards claim they can help you get there more quickly: the Rocket Visa Signature® Card and Bilt Mastercard®.

The Rocket Visa Signature® Card earns 5% cash back on all purchases — but only if you redeem those rewards toward the closing costs on your new home, and as long as your loan is through Rocket Mortgage. Furthermore, you can only redeem a maximum of 800,000 Rocket Points, or $8,000, per new mortgage loan.

Meanwhile, new homebuyers who participate in Bilt Rewards can earn 1 Bilt Point per $2 on the total cost of a new home — as long as their real estate agent works under Bilt’s partner brokerage eXp Realty. Bilt Rewards is the company behind the popular Bilt Mastercard®, which lets renters pay rent on a credit card without incurring a transaction fee.

Bilt Members can also redeem Bilt Points toward a down payment on any home, so this double benefit can be worth a good chunk of change.

Both cards offer a tantalizing proposition for prospective homebuyers, many of whom find the American dream of home ownership more difficult than ever. But both cards also have some real limitations, since the savings only apply when you work with Rocket Mortgage or an eXp agent (or both).

The good news is you don’t need a specialized card to save money as you prepare to buy a home. The best cash-back credit cards earn up to 5% on common household expenses.

Rocket Visa Signature® Card

The Rocket Visa Signature® Card is a great option for prospective homebuyers who plan to finance their purchase with a Rocket Mortgage loan.

This no-annual-fee credit card earns 5 points for every $1 spent on all qualifying purchases — a generous rate that outstrips most of the standard cash back credit cards, since none earn 5% back on everything.

Rocket Points vary in value based on how you redeem them. They’re worth the most — 1 cent apiece — when redeemed toward closing costs, down payment, or buying down your interest rate on a new home purchase financed through a Rocket Mortgage loan.

You can redeem up to $8,000 (800,000 Rocket Points) per new Rocket Mortgage transaction. Using your rewards this way can save you tens of thousands of dollars in compound interest savings over the lifetime of your mortgage.

Rocket Points are less valuable when redeemed in other ways. They’re worth just 0.4 cents apiece, or the equivalent of 2% cash back per dollar spent, when used to pay down your existing mortgage principle.

And if you redeem your rewards as a statement credit on your card balance, they’re worth a measly 0.25 cents apiece, or the equivalent of 1.25% cash back.

Bilt Rewards

The Bilt Mastercard® is already becoming a household name for renters looking to maximize credit card rewards, and you can continue that relationship as you enter your homebuying era.

This $0-annual-fee credit card (rates and fees) won’t cost you an additional fee to keep long-term, and earns great rewards on dining, travel, and other expenses especially on Bilt Rent Day, when most purchases, excluding rent, earn double points, up to 1,000 points each month. Note that you must make at least five transactions per statement period to earn points.

You don’t even need to be a Bilt credit cardholder to earn Bilt Points — simply joining the Bilt Rewards program is sufficient. All Bilt Rewards program members can earn 1 point per $2 spent on a new home purchased through an eXp Realty real estate agent.

The best way to maximize the value of your Bilt Points is by using them for travel. But if you’re buying a home, you can also redeem any points you’ve already earned up until this point as a credit toward your down payment, at a respectable value of 1.5 cents per point.

If you buy a $500,000 house, you’d earn 250,000 Bilt Points. However, you wouldn’t be able to claim that windfall until your purchase is complete, since you can’t redeem points you don’t yet own. Once the Bilt Points from your home purchase reach your account, however, you can redeem them for travel, credit toward future credit card statements, and more.

Since there’s no cap on how much you can earn on home purchase prices or redeem, Bilt members can come out way ahead with this program, especially because there aren’t any annual fees to factor in. And if you happen to utilize Rocket Mortgage for your loan as well, you could double-dip on both sets of savings: $8,000 in Rocket Mortgage credit, plus however many points you earn from your home purchase.

What really matters when buying a house

A standard-issue cash-back credit card may sound uninteresting when compared to the Rocket card’s 5% cash back in mortgage savings on everything, or 2 Bilt Points per dollar spent on a new house. But the most important aspect of buying a house is making sure that the home — and the homebuying process — is right for you.

In the grand scheme of things, $8,000 or even 200,000 credit card points is small potatoes compared to the life-changing investment you’re about to make. Don’t allow the excitement of earning rewards distract you from finding a real estate agent you jive with and shopping around for a trustworthy lender with the best mortgage interest rates available to you.

Getting the right mortgage is especially challenging in this day and age of high interest rates, and finding the right mortgage lender as a first-time buyer is a decision that will impact your life for decades to come.

The case for cash-back credit cards

Believe it or not, getting a credit card can actually help you buy a house; using one responsibly is a great way to build a strong credit history that can help you score a great mortgage rate on your dream home.

Cash-back credit cards have their pros and cons, but they generally share a common trait: They’re easy to use. Whether you opt for a flat-rate 2% cash back credit card or choose one that earns 5% cash back on bonus categories, what you earn is what you keep.

Many cash-back credit cards also don’t charge annual fees, so you can keep your card open for years without worrying how much it costs. This is especially valuable leading up to a new home purchase, when you need to maintain your credit score to buy a house and to get the best mortgage rate.

If you’re wondering whether you can use your credit card to pay your mortgage, however, the answer is typically no. Lenders generally frown upon using debt to pay off other debt — your credit card represents a line of credit and your mortgage is a fixed monthly payment on the sum of what you owe for your house.

But some credit card issuers are warming up to the idea, so stay tuned for new developments in credit cards that can be used for paying mortgage payments in months to come. Bilt claims it will begin allowing program members to pay mortgages in 2025, while new fintech company Mesa has an invite-only waitlist for a credit card designed for paying mortgages.

In the meantime, you can use a service like Plastiq to pay your mortgage — or most check-based payments, for that matter — using your credit card, as long as you’re willing to pay a processing fee around 2.9% per transaction.

When every penny counts, make sure your credit card rewards fit your lifestyle and your needs — not the other way around.