The Bilt Mastercard® (review) is a popular no annual fee card, which allows you to pay your rent by credit card and earn rewards, even if your landlord doesn’t ordinarily allow no-fee credit card payments.
Unfortunately a couple of popular aspects of the card are being devalued in the coming months. While these changes won’t impact everyone, they’re still pretty significant. I posted about the first change last week, but we’ve now found out about a second change.
In this post:
Bilt caps Rent Day bonus rewards at 1,000 points
Bilt has a monthly Rent Day promotion. While there’s a unique promotion every month, one thing that’s consistent is that you can earn double points on your card spending on the first day of each month.
Since the card ordinarily offers 3x points on dining, 2x points on travel, and 1x points on other purchases, this means you can potentially earn anywhere from 2-6x points per dollar spent.
Historically this has been capped at up to 10,000 bonus points per Rent Day. However, that will be changing soon. As of the Rent Day on October 1, 2024, you’ll be capped at earning 1,000 bonus points per Rent Day, rather than 10,000 bonus points, representing a 90% reduction in the cap.
Bilt exempts tax payments from Rent Day bonus
It’s possible to pay taxes by credit card, and that can be a great value for those of us into maximizing points, since you can do so for a fee of under 2%. As you’d expect, a fair number of people would make tax payments on Rent Day, to earn 2x Bilt points for such payments.
As it turns out, as of October 1, 2024, Bilt will exempt tax payments from the Rent Day bonus. That means you’ll no longer be able to earn 2x points on tax payments on Rent Day. I’m a bit surprised to see this change, simply because you’d think the cap of 1,000 bonus points with Rent Day would already greatly limit Bilt’s exposure. On top of that, the lack of communication surrounding this is quite frustrating.
As flagged by Frequent Miler, this hasn’t been announced in any official capacity, but rather in an interview with The Points Guy, this is mentioned in a way that suggests this is something we should already know about:
Was similar information used in the decision to remove bonus points on tax payments as of Oct. 1?
We discovered that bonus points on tax payments during promotions accounted for 20% of our bonus category costs, yet only 0.8% of cardmembers (or 0.12% of our total members) use the card for taxes. That’s why as part of the above Oct. 1 Rent Day update, tax payments will be excluded from bonus point promotions. This allows us to reinvest in benefits that all members can enjoy.
These changes are of course disappointing
Odds are that these changes won’t impact a vast majority of members. When it comes to the new cap of 1,000 bonus points on Rent Day, you’d reach the cap after spending $1,000 in non-bonused categories, $500 on travel, or $333 on dining.
However, a lot of people also specifically make larger purchases on the first of the month in order to maximize this opportunity. I of course understand how Bilt probably doesn’t want people specifically making large purchases on Rent Day to earn more rewards, but then again, the company also heavily promotes Rent Day, and it becomes a lot less interesting for many with such a low cap.
If you pay rent, you absolutely should earn bonus rewards with Bilt, given the lack of an opportunity cost. But if the goal is to actually get people to spend money on the card, there needs to be a value proposition that’s competitive with the best cards out there, in my opinion.
I think Bilt is kind of struggling to figure out where it wants to position itself in the market at the moment. We did recently learn about some of the economics of Bilt, including how Wells Fargo is reportedly losing $10 million per month on Bilt.
According to The Wall Street Journal story about Bilt, Wells Fargo made a big bet on the product, but the math just hasn’t worked out as was expected, as people aren’t spending as much on non-rent purchases as was hoped. However, the contract between the two companies runs through 2029, and Wells Fargo may not have an easy way to get out of it.
I’m sure Bilt is trying to cut costs a bit and make its economics a bit better. At the same time, that could come at the expense of growth, and if there’s one thing that’s important for startups to show to get their multi-billion dollar valuations, it’s continued growth. If that slows down, even if profitability improves (or losses decrease), it’s not necessarily good.
I can of course appreciate that Bilt doesn’t want its target audience to exclusively be points maximizers and “gamers.” The Bilt Mastercard is a great no annual fee product with a solid rewards structure. However, as you start cutting away more of these benefits, it becomes harder for those of us with a lot of other cards to justify having the card. After all, there are other cards offering 2x transferable points on all spending, and they have no issues with us making tax payments.
The whole Bilt concept has sort of been viewed — and in many ways, even promoted — as “too good to be true,” as you can basically get something for nothing. Bilt isn’t making money when people make five small purchases per month (to trigger the ability to earn points on your rent), and then earn rewards for their rent.
But even for those of us who are non-gamers, it’s harder to make sense of the card’s value proposition as more restrictions are added.
I’m curious if these are isolated changes, or if we see more changes added over time. For example, could we see Bilt add a higher monthly spending or transaction requirement in order to unlock the ability to earn rewards for rent purchases? That would really be a game changer…
Bottom line
Bilt offers double points on Rent Day, which is the first of each month. However, as of October 1, 2024, the company is lowering the cap on bonus points from 10,000 to 1,000. Not only that, but you’ll no longer be able to earn double rewards on tax spending on Rent Day, which seems like a pretty stingy change, when you consider the new limit of 1,000 points.
If you’ve historically made big purchases on Rent Day, this is certainly something to be aware of.
What do you make of Bilt’s new Rent Day restrictions?
I never understood why this card is SO popular. I understand that it gives the ability to charge rent to a credit card but the rewards are rather not good. Mostly it is about transfer partners and they lack many transfer partners. ....
Getting a Bilt card was the biggest mistake of my points and miles hacking career. First, getting approved by WF sucked; they wanted a grimly hilarious array of documents ***faxed*** over to them, then they dragged their feet reviewing, and eventually I just had to make the purchases I had planned for the Bilt welcome offer on other cards instead. By the time I was approved, I didn't have much spend left to put on...
Getting a Bilt card was the biggest mistake of my points and miles hacking career. First, getting approved by WF sucked; they wanted a grimly hilarious array of documents ***faxed*** over to them, then they dragged their feet reviewing, and eventually I just had to make the purchases I had planned for the Bilt welcome offer on other cards instead. By the time I was approved, I didn't have much spend left to put on the card and missed the bonus. The WF online account is a giant PITA to manage. I put my rent on new cards from other issuers to hit the SUB anyway; I'll happily pay the processing fee so that I'm not wasting my biggest expense on on 1x points. And it ate up one of my 5/24 slots.
Now we've got fewer transfer bonuses and these big devals. Giant headache and complete waste of time.
Yep. Getting upwards of 12K points per year that you’d otherwise not have is awful. Just horrendous.
Having a Hyatt transfer partner other than Chase. It’s so brutal.
“I put my rent on new cards from other issuers to hit the SUB anyway”
Right. Because you’re opening 10 new cards per year. Sure.
On a more serious note though, *never* provide supplemental information for a credit card application. That’s never a good...
Yep. Getting upwards of 12K points per year that you’d otherwise not have is awful. Just horrendous.
Having a Hyatt transfer partner other than Chase. It’s so brutal.
“I put my rent on new cards from other issuers to hit the SUB anyway”
Right. Because you’re opening 10 new cards per year. Sure.
On a more serious note though, *never* provide supplemental information for a credit card application. That’s never a good sign and there is no good reason for said company to have that much info about you.
“That’s never a good sign and there is no good reason for said company to have that much info about you.”
Especially Wells Fargo, with their long history of abusing customers, and what many say are extremely sloppy data security practices.
My P2 and I opened 3-4 cards each last year and all the rent was toward SUB.
Bilt IS awful.
Wells Fargo just keeps losing.
It’s the Donald Trump of banking: Stupid, dishonest-and-keeps-getting-caught, and can’t make a sound investment to save their lives.
It’s surprising they haven’t been shuttered already for RICO violations.
I doubt we see changes to the 5 transaction a month deal (having some spend threshold instead). I suspect that would cause a big drop in users, and with wells fargo locked in for another 5 years why panic now and kill growth. I still don't see how even spending $500/mo will make up for all the points given away for free on rent.
I have no idea what they will do in 3-4 years... This product is probably viewed as toxic and i doubt any other bank will pick it up.
Contrary to your comment (as well as Ben's and Gary's blogs) Well is not "locked in" to anything. They set up a separate legal entity to contract for Bilt and could easily throw that corporate sub into Chapter 11 (or shut it down completely). I've been a senior officer of a number of national companies and the corporate structure is set up in a way to minimize taxes (like having all corporate payroll based on...
Contrary to your comment (as well as Ben's and Gary's blogs) Well is not "locked in" to anything. They set up a separate legal entity to contract for Bilt and could easily throw that corporate sub into Chapter 11 (or shut it down completely). I've been a senior officer of a number of national companies and the corporate structure is set up in a way to minimize taxes (like having all corporate payroll based on a Texas sub for one company) or to keep flexibility regarding future requirements. Wells did not contract with Bilt, a subsidiary whole-owned by Wells, but that is a separate legal entity, did and that company can easily be shut down.
I fully expect Wells to wash their hands of Bilt in the next 12-18 months.
Amusing to see this comment section filled on a Saturday morning with the foremost experts in economic theory, venture capital, and business acumen.
Ankur (CEO of Bilt) will read these and laugh.
Sometimes it’s not that outsiders are too dumb to understand the startup’s genius new business model. Sometimes it’s just that outsiders can see through the wall of blather and obfuscation that the startup is surrounding itself with.
Bilt reminds me a bit of MoviePass. As soon as MoviePass got big, everyone asked the obvious question, which was “how the heck is this business sustainable”? MoviePass put up a wall of blather about how they’d...
Sometimes it’s not that outsiders are too dumb to understand the startup’s genius new business model. Sometimes it’s just that outsiders can see through the wall of blather and obfuscation that the startup is surrounding itself with.
Bilt reminds me a bit of MoviePass. As soon as MoviePass got big, everyone asked the obvious question, which was “how the heck is this business sustainable”? MoviePass put up a wall of blather about how they’d be profitable because analytics big data incremental revenue income partnership streams or whatever. But anyone could see that the whole thing that made the product compelling was a giant loss leader and there was no avenue for generating revenue to make up for it. They started cutting their compelling feature to reduce burn, customers left in droves, and they flamed out. It seems that Bilt is now reaching that phase.
@BF love this comment. My 72 year old father was an early user of MoviePass because he loves movies. He quickly figured out the loopholes and watched in disbelief as they continued to get more funding. He maxed out every loophole until they finally closed them all and shut down.
Bilt attracted people who love points and are slowly closing every loophole to be exploited. Big spenders will leave first. If they start putting...
@BF love this comment. My 72 year old father was an early user of MoviePass because he loves movies. He quickly figured out the loopholes and watched in disbelief as they continued to get more funding. He maxed out every loophole until they finally closed them all and shut down.
Bilt attracted people who love points and are slowly closing every loophole to be exploited. Big spenders will leave first. If they start putting up more requirements, small spenders will leave next.
I'm also sad to see their next funding coming from a teacher's pension. How about just an index fund. :( Really sad if they go down.
What makes you say that? Honestly, has there been a *single* indication that this business is doing well?
There's no indication it's doing well, and plenty that's it's not. Ankur may well laugh at the company's detractors, but time will tell. I just hope he's not using his father's InfoSpace business model, because that was a complete disaster.
Agreed @Pete. I’m so pessimistic about this company’s prospects that it’s the *one* exception I make to the save-up-points-before-transferring rule many of us here follow. Instant transfers to Hyatt or Alaska every time I bounce above 1k lol. I’m not holding my breath for a transfer bonus.
Bilt has become yet another publicly-visible GRC embarrassment for Wells Fargo.
Bilt will need to shed the sub 1 pct of its member base that is highly unprofitable and likely to remain that way.
They do not have a viable business model if they retain their most aggressive users. But it's an open question as to whether their profitable naive users will ever generate enough revenue to satisfy investor growth targets.
https://www.businesswire.com/news/home/20240802957679/en/Bilt-Rewards-Secures-150-Million-in-Additional-Funding-Led-by-Ontario-Teachers-Pension-Plan-Growth
They just raised money - more cuts are coming.
I'm assuming that the 5 transaction requirement will be the next thing to change. I used to put all of my spend on the 1st of the month on this card, but with these changes now my incentive is to just pay my rent, have a nice dinner for 2 on the first of the month (that will basically max out the rent day bonus), and then just $1 reloads to get to the 5...
I'm assuming that the 5 transaction requirement will be the next thing to change. I used to put all of my spend on the 1st of the month on this card, but with these changes now my incentive is to just pay my rent, have a nice dinner for 2 on the first of the month (that will basically max out the rent day bonus), and then just $1 reloads to get to the 5 transaction requirement.
When the card was first announced, I believe the plan had been that you would need to spend $500 in non-rent payments each month in order to earn points for your rent. Wouldn't surprise me if they end up somewhere around there again.
Yeah… but if those requirements tighten much further a lot of us will jump ship. It’s just such a lousy card for non-rent spend.
Big surprise. Their unconventional business plan was up against the well funded big banks.
Something’s gotta give - excessive spending on advertising and celebrity endorsements is not correlating with income and growth. Expect more cutbacks in the value prop as the economics are unsustainable and the funding dries up.
Home ownership, marriage, providing for family and having children are the ultimate alpha male attributes.
Most "men" in cities these days are childless renters with possible live in girlfriends. They are more concerned with their free time and weekend brunches than having a family. Beta males run amok in cities.
Grow up.
Lol what is this, 1950?
I guess Mrs. JD Vance calls her husband "Vinay"?
Sir, this is a Wendy’s.
“Childless dog guys”???
Look, Johnny Bowman, oops I mean J.D.Vance has joined the forum.
Ooh brunch sounds good.
Don’t give them any ideas.