Investor · Atlanta, GA · Member since 2015 · 110 posts · 37 votes
Hi all,
I am confused with all the options Home Depot offers. As a disclaimer, I did read through past posts on this same topic, and still not sure what I should sign up for. What would you recommend for a rehabber?
A. Consumer Credit Card
B. Project Loan Card
C. Commercial Revolving Charge
D. Commercial Account
Also, which one(s) would work better for purchases in personal name vs LLC?
I'm in a cash positive position, I don't need other people's money nor rob peter to pay paul, whether I pay for it up front or in 18 months it's still an expense to me and with abundant cash there is no benefit to me carrying balances so getting another 2% back is just free money on top of the cash already coming in.
Like I said, in my post if you aren't paying off your balance each month I can't help you. If you need other people's money then a 2% cash back card isn't the answer.
Let's step down of the moral soap box for a second and not make so many assumption about the person you are addressing.
Many of us, like yourself, are in cash positive position and do not "need" other peoples money, but that does not mean you should not use other peoples money if the cost to do so is less than the opportunity costs to use your own capital.
The case at hand, Home Depot's Consumer card with its 12-24 month payment plan at 0% interest, is "cheaper" money than the opportunity cost of using our own capital - which while parked is earning between a 5.5 - 6.5% return. In addition, I'm paying for Home Depot's financing programme whether I use it or not ... ie. I do not get any better pricing if I pay upfront versus use their financing.
In my earlier post I indicated we would may be purchasing 40+ appliances (perhaps as many as 80) at some point in the next 12 months. Sure, we could write a cheque for the purchase, or put that 30K on our credit card and earn $900.00 cash-back. Or, we could financing the entire purchase at 0% over 18 - 24 months out of cash-flow and leave that 30K to earn 2500 - 3900 over the same period.
Investor · Saint Paul, MN · Member since 2015 · 663 posts · 512 votes
10y
If you have saved money from your positive cash flowing rental property, what would you need a credit card for. I pay for everything with my bank card. Credit cards will never make you wealthy.
Investor · Atlanta, GA · Member since 2015 · 110 posts · 37 votes
10y
Thanks everyone for contributing! A lot of interesting information here..
To address some of the questions asked in this thread:
1. My idea of applying for HD credit card is primarily based on the objective of optimizing discounts on materials/appliances. Another objective is to build good credit/track record for my newly formed LLC.
2. Unless it is a 0% interest for X months type of card, I intend to pay it off every month. However, if it is 0% for X months, then I'd chose to maximize it instead of using bank money.
3. I do like @Roy N. approach to purchasing appliances. I'd love to hear more on this topic, if anyone can share other ways of optimizing cash flow using HD/Lowe's accounts.