In the world of credit cards the Bilt card has been unique in that it’s the only card that allows you to earn points on rent. for many, myself included, the card was a slam dunk for the simple reason that it had no annual value and earned rent at a 1x rate, and if you combine that with some of Bilt’s unique transfer partners (including Alaska Atmos and JAL Mileage Bank) there really was no reason not to get it if you are renting.

That all changes on February 7. Bilt today announced the details of the card’s revamp: Bilt 2.0 changes just about everything about the original card, and not in a good way. Let’s dive into the details, and what this means for users of the original card in practical terms.

1. How the old card worked: some historical context
2. The new model: earning ‘Bilt cash’ to redeem against rent or mortgage payments, but requires 75% of your rent in non-rent spending
3. The new Bilt 2.0 card portfolio
   1. Bilt Blue Card
   2. Bilt Obsidian Card
   3. Bilt Palladium Card
4. You can choose which card you want to transition to, and here’s how
5. With these changes, earning points on rent is no longer worth it for most users
6. Which card should you transition to? The Palladium card is the only card with some potential
7. Summary

How the old card worked: some historical context

To understand how massive the changes are, let me first describe the way the current/old (v1.0) card worked. This card was in partnership with Wells Fargo. It is a no-annual-fee card that earns 1x points essentially on everything, including rent. However, to earn that 1x on rent you’d have to make at least 5 not rent related transactions every month.

The expectation was that users would switch their spending over to Bilt in a way that would balance out the many points that were earned through rent, but this never materialized and Wells Fargo reportedly lost many millions every month on Bilt. It seems many people simply out 5 (small) transactions onto Bilt to qualify for rent points, and that was it (my husband and I did the same thing). Clearly, this was not sustainable and we have known for a while that Wells Fargo decided to pull out.

This ultimately prompted Bilt 2.0, now in partnership with Cardless, which also has partnered with various other companies, including Qatar Airways and Avianca to release credit cards. But this time around, it was clear the business model would have to change in order for the points on rent to remain sustainable. How would that be accomplished? That’s what we learned today: we now know the details of the new cards (now three instead of just the one) and how points on rent will be handled.

The new model: earning ‘Bilt cash’ to redeem against rent or mortgage payments, but requires 75% of your rent in non-rent spending

The new model is a radical departure from the way the card used to work. It’s complex, but let’s first look at what Bilt says about this, and then I’ll break it down for you:

Everyday spend now fuels how many points you can unlock on housing payments. The more you use your Bilt Card, the more Bilt Cash you can earn to use to unlock points on housing payments.

For every $30 in Bilt Cash earned, you can unlock 1,000 Bilt Points when you make rent or mortgage payments, across multiple homes. For example, if your rent is $2,000 and you have $60 of Bilt Cash, you can convert your Bilt Cash into 2,000 points on that payment — still with no transaction fee.

So here’s the two main points you need to understand:

• Spending on rent does not actually seem to generate any points at all by itself (though that’s how it used to work!).
• Instead, redeeming Bilt Cash against rent spending is what generates points.

If you put these two points together, here’s how things work out in practical terms:

1. You use your Bilt card for non-Rent purchases.
2. These purchases earn you 4% Bilt Cash, so for every $1 spent, you’ll earn $0.04 in Bilt Cash.
3. Now, you can ‘redeem’ your Bilt Cash against any rent spending you put on the card.
4. This will generate Bilt points, at a rate of 100 points for every $3 Bilt Cash you redeem against rent.

In practical terms, it means you need to spend 75% the dollar value of your rent on non-rent purchases, in order to gain enough Bilt Cash that you cna get the 1x points rate for your rent.

Let’s consider Bilt’s example. The idea is that in order to earn points from rent at the 1x rate, then if you want to earn 2000 points from $2000 rent, you’ll need to redeem $60 worth of Bilt Cash. Why? Because $3 Bilt Cash generates 100 points. So (2000/100) * $3 = $60 Bilt Cash. To earn that Bilt Cash, remember you earn 4 cent Bilt Cash for every dollar you spend on non-rent purchases. In other words, you’ll need to spend ($60/$0.04) = $1500. Or, 75% of the dollar value of your rent will need to be spent on non-rent purchases in order to earn enough Bilt Cash to get a 1x points rate on your rent.

Note that Bilt Cash can be redeemed for other things as well. As per the press release:

Bilt Cash gives you flexibility: earn it from everyday spend and choose how to use it, whether to unlock points on housing payments, transfer bonuses, and exclusive experiences, or to spend dollar-for-dollar on monthly credits at restaurants, hotels, rideshare, and more.

So, there is definitely room to use the Bilt Cash for other things, at a 1:1 rate. This is important when thinking about the longterm usefulness of the credit cards.

I think this is a smart way of handling this on Bilt’s side, but it’s certainly a convoluted thing to subject your users to. Now let’s look at the actual cards that can generate all of this.

The new Bilt 2.0 card portfolio

There are three Bilt cards in the 2.0 model. Some features are common to all cards:

• Pay rent and mortgage without a transaction fee. Mortgage payments are new!
• Earn Bilt Cash on every non-rent/mortgage transaction at a rate of 4%.

With that out of the way, let’s look at the three different cards’ features. The bullet points are copied directly from Bilt’s press release:

Bilt Blue Card

This is the cheap, no annual fee option, but it also comes with few features:

Bilt Obsidian Card

The mid-range card, with a decent annual fee and some more useful earning categories. The annual fee can be

Bilt Palladium Card

This is the most premium card with a big annual fee, but also a bunch of credits that can entirely offset that annual fee:

You can choose which card you want to transition to, and here’s how

For current card holders, take note: you have to make a decision on whether you want to transition to one of these three cards or not by January 30th, and the new cards will ‘kick in’ on February 7th. If not, you will transition to a the Wells Fargo Autograph Signature card.

If you do want to transition to these cards, you can do so through the Bilt app or website. If you transition:

• You will keep your same card number – subscriptions and autopay continue uninterrupted.
• Automatic updates to Apple Pay and Google Pay.
• The transition will require an approval from Cardless, but will not result in a hard credit inquiry.
• If you don’t transition and instead apply later on, you will get a hard inquiry, so it’s best to transition now rather than applying later.

To start the process, go to the Bilt website and navigate to the special page featuring the new credit cards, then login to your account. Click ‘Apply Now’ and you’ll be presented with these three cards and asked to select the one you want.

You’ll confirm your income and monthly rent or mortgage payment, after which an approval process wil start. We just went through this and were approved with a hefty credit line. Once approved, you can choose to accept the offer until January 30th. We accepted it immediately, which prompts a series of questions: whether to transfer your current balance, what to do with the Wells Fargo card (keep the credit line or close it), and whether to add a bank account to pull rent payments from. With that, the process will complete. You can expect an email in your inbox confirming your acceptance of the approved card.

With these changes, earning points on rent is no longer worth it for most users

Given all these changes, I actually think that earning points for rent using Bilt credit cards is no longer worth it for most users. That’s because to earn those points you need to put significant monthly spending on the card. The problem is that the earn rate on that ‘everyday spending’ on the Bilt cards is just not optimal. Let’s look at the categories that earn an above 1x rate with any of the Bilt cards:

• Dining and groceries: Amex Gold has an unbeatable 4x return. Friday and Saturday nights, the Citibank Strata Elite gets you a 6x rate. Even cards like the Citibank Strata Premier earns 3x on both those categories.
• Travel: The Sapphire Reserve earns you 3x, and many other cards provide you 2x.
• Other categories: The Capital One Venture family gets you 2x, and the Strata Elite 1.5x on other categories, so this is something where the Bilt palladium is at least competitive.

With that said, let’s do the math. If you need to spend $1500 per month to enable 1x point son $2000 on rate, let’s say that:

• $600 comes from restaurants and takeout: The Amex gold will generate 2400 points.
• $400 comes from groceries: The Amex Gold will generate 1600 points
• $300 comes from any and all travel: many cards can generate 600 points
• $200 comes from miscellaneous: If you have a Capital One Venture card, you can generate 400 points, otherwise perhaps 200.

In total I can generate 5000 points at least using the cards I have. Now, if I were to put this on the Bilt card, I will generate 2000 points from rent, plus between 1500 and 3000 points from the everyday spending. So with the Bilt cards, at best I’ll earn the same – at worst I’ll miss out on 1500 points.

However, it can get worse: keep in mind that the spend required to earn the points on rent will scale with rent. If your rent is $6000 per month, you’ll need to spend $4500 per month on non-rent categories. Many users may simply not be able to spend those sums to enable the points from rent, and if that happens, you won’t even get 1x points on rent, drastically worsening the points earning rate.

As such, with these changes, I can’t really recommend trying to go for the points from rent.

Which card should you transition to? The Palladium card is the only card with some potential

Given the above, if you’re not using the Bilt card for rent, then why would you stick with Bilt at all? That’s an excellent point, and I think the answer will be very personal. For me, a motivating factor to stick with Bilt are Bilt’s unique transfer partners Alaska Atmos and JAL Mileage Bank. In order to keep the option of transferring points to these partners, I’d be willing to keep a Bilt card.

But which one to pick? I think the Palladium card is the only option with added value:

• Right now, between my husband and I only my husband has a Priority Pass card, so it’d be great if we both had a card that offers Priority Pass. If you already get Priority Pass through another card, this may be a moot point.
• The 2x earning rate rivals that of the Capital One Venture card family. Earning Bilt points at that rate for transfer to Alaska or JAL is pretty great, and I’d probably choose to spend on Bilt rather than Venture. As a matter of fact, this may lead me to cancel my Venture card…
• The annual credits are enough to entirely offset the annual fee: two $200 hotel credits and $200 Bilt Cash that can be used against dining, hotels, rideshare and other things. Both of these credits are as good as cash and 100% offset the annual fee.
• The 50.000 point and $300 Bilt Cash welcome offer is great and worth a lot to me, given that the points can be transferred to Alaska or JAL, as well as other transfer partners. This offer is only available on the Palladium card.

On the other hand, the other two cards have little to offer. The Blue card has no annual fee, but also doesn’t really offer any appealing features. This is a card we would simply not use. On the other hand, the Obsidian card has some potentially useful points earning categories, except that other cards we have already offer better earning rates on all these categories. Again, I wouldn’t actually use this card.

So here’s my play: My husband I just applied, and were approved for, the Palladium card! We will see how it works out for the first year. The 50.000 points are awesome, and the $300 Bilt Cash, plus the other credits will more than offset the annual fee for almost 2 years ($300 Bilt Cash + $400 Hotel credit + $200 Bilt Cash = $900 in credits and Bilt Cash). If you like it and get good use of it, you might keep it. If not, should be able to downgrade to the Bilt Blue card, which has no annual fee.

Summary

Bilt just announced it’s next version of it’s slam-dunk rent rewards credit card. This Bilt 2.0, unfortunately, isn’t nearly as good a deal. While it does now include the option to earn points on mortgage, I would go so far as to say that it’s become a largely unappealing product.

The crux of it is the convoluted system to earn points on rent. Long story short, you will need to spend 75% the dollar value of your rent, on non-rent purchases. This is because you don’t earn points on rent directly, rather your non-rent purchases earn you Bilt Cash, which can be used to redeem points against rent at a rate of 100 points for every $3 of Bilt Cash. In my mind, because of the non-rent spending requirement, I actually think that the Bilt cards are not really worth the investment for the rent points earning anymore.

In terms of the actual cards, it seems a fairly standard selection of cards with a no fee, midrange $95 and premium $495 annual fee card. Of these, if you’d want to transition to any of these cards, my recommendation would be the $495 Palladium card. It has a 50.000-point welcome offer that is indeed also available to you if you transition from the old Bilt card. The credits it comes with will offset the annual fee, so it shouldn’t be too hard to break even on this and give the card a go.