My take on Bilt 2.0

Bilt arguably has the best set of transfer partners and the best periodic transfer bonuses among transferable points programs. Despite that, Bilt hasn’t been my favorite transferable points program. The primary reason for this is that Bilt points have been hard to earn in large quantities unless you have very high rent payments. Until now, Bilt had only one credit card, no dependable signup bonus, and no way to earn points through a shopping portal. Further, they used to offer a way to get at least 2x on all spend on Rent Day (the first of each month), but a couple of years ago, they capped that at a measly 1,000 points per month. All of this changes with Bilt’s new Rakuten Shopping partnership and with Bilt 2.0, which includes earning 1x on rent or mortgages, 2x on all other spend, and a 50,000-point signup bonus. But all of this goodness comes at a cost…

The downsides of Bilt 2.0

There are several downsides to Bilt 2.0 that involve the transition from old to new… One obvious downside to Bilt 2.0 concerns those who used to earn lots of points from paying rent but didn’t otherwise spend much on their Bilt cards. That group will have to drastically ramp up card spending if they want to continue earning points on rent payments fee-free. Another downside is that the old fee-free card had a couple of valuable category bonuses, whereas with Bilt 2.0, you need the $95 card to match that earning power.

Let’s ignore how things used to be, though, and look at Bilt 2.0 as a set of brand-new credit card products. Even from that light, there are things I dislike:

• Complexity: The Bilt 2.0 cards earn two types of rewards currency: Bilt points and Bilt Cash. Bilt Cash cents can be indirectly converted to Bilt points at a 3-to-1 rate by using Bilt Cash to cover the fees when paying rent or mortgage. That’s complicated enough, but there’s also the fact that Bilt Cash seems to be less than half-baked at launch. Other than using Bilt Cash to cover payment processing fees, we don’t yet have any clear information about how Bilt Cash can be used elsewhere. We know there will be limits and restrictions. What will they be? We’ve been told that the answers may vary by merchant and circumstance. This has made it impossible to get any clear idea of how much we should value Bilt Cash. Oh, and all but $100 of your Bilt Cash expires at the end of every year, even if it was earned in December.
• Coupons: Coupons have infected almost all new credit cards, and Bilt’s cards are no exception. The $95 Bilt Obsidian card includes twice-annual $50 hotel credits to offset the annual fee. The $495 Palladium Card includes twice-annual $200 hotel credits plus annual $200 Bilt Cash to offset its annual fee. I’d be happy with the hotel credits if they could be used for any bookings, but we’ve been told that they require a minimum of 2 nights and may have caps on how much can be spent per booking. Bilt Cash itself is like an uber-coupon (but not “Uber” coupon) that can be used for many things, each with its own limits and restrictions.

The good stuff

There’s a lot to like in Bilt 2.0:

• Earn points paying your mortgage: People have been asking Bilt for the ability to earn points when paying mortgages since the beginning of Bilt time. Now, cardholders can do exactly that.
• Pay multiple rents and mortgages: With Bilt 2.0, you are no longer limited to paying a single landlord, and there’s no need for the lease or mortgage to be in your name. This opens up opportunities for those with multiple payments to make and those who don’t have rent or a mortgage to pay on their own. For example, my mom has large rent payments, so I plan to use Bilt to pay her rent (and she can pay me back separately).
• Earn 4% Bilt Cash on all non-rent/mortgage spend: All three cards offer points for spend, plus 4% in Bilt Cash. Bilt claims that Bilt Cash will be redeemable for more and better things over time. If/when that pans out, this could be incredible. Earning anywhere near 4% in value on top of 1x to 3x in points would be unbelievable.
• Earn 2x to 3.33x everywhere with the $495 Palladium Card: The Palladium Card is incredibly rewarding for spend. It offers 2 points per dollar on all non-rent/mortgage spend, plus 4% in Bilt Cash (which can be indirectly exchanged for 1.33x points through rent or mortgage payments). The net result is that it is possible to earn up to 3.33x on all spend as long as one has enough rent and/or mortgage payments to make good use of their Bilt Cash. Earning between 2x and 3.33x transferable points on all spend is incredible enough on its own, but when you consider that Bilt has the most valuable transfer partners (Hyatt, JAL, Alaska, etc.) and periodically offers huge transfer bonuses, it’s really crazy how valuable this opportunity can be.

My Approach

It’s awesome that Bilt is letting current 1.0 cardholders get the signup bonus when they switch to a Bilt 2.0 card. Even if I didn’t want the $495 Palladium card long-term, I’d go for that one now for the 50K bonus and cancel or downgrade in year two. In my case, though, I do want the Palladium card:

• Annual fee – $495
• Welcome offer – 50,000 Bilt points + $300 Bilt Cash + Bilt Gold status after $4,000 spend in first three months
• Bilt points earning rate:
  • 2x on everyday spend
  • 1x on mortgage and rent
• Bilt Cash earning rate – 4% on everyday spend (excludes mortgage & rent)
• Card features/benefits:
  • $400 Bilt Travel Hotel credit (twice annual i.e. $200 Jan-Jun & $200 Jul-Dec). Two night minimum stay required.
  • $200 Bilt Cash annually
  • Priority Pass
  • Redeem Bilt Cash to waive mortgage and rent transaction fees

I don’t like the card’s $495 annual fee, I have no use for yet another Priority Pass, and I don’t like coupons. That said, the card’s earning power is really impressive. I’ll hold my nose with the hotel coupons and find ways to get good value from them. And I’ll use the Palladium card for all of my non-category-bonus spend (spend that doesn’t otherwise get better multipliers from other cards).

Consider this plan:

• Monthly:
  • Spend $6,000, earning 2x. Earn 12,000 points plus $240 Bilt Cash
  • Pay $8,000 in rent, earning 1x. Use $240 in Bilt Cash to cover the fees. Earn 8,000 points.
• Annual Total:
  • Earn 240,000 points per year
  • Earn Platinum status each year (You get Platinum status with $50K spend or 200K points earned. I would qualify on both counts)
  • Platinum status would qualify me for the top transfer bonuses when available. Historically, these usually top out at 100% (although we’ve seen even higher), so 200K points could become 400,000 airline miles.
  • Having any elite status at all will mean I can continue, long term, to earn Bilt points through the Rakuten shopping portal at the full 1-to-1 ratio.

Conclusion

A number of people are understandably upset about some aspects of the transition to Bilt 2.0. And Bilt 2.0 is absurdly complicated. But under the right conditions, Bilt 2.0 can be extremely rewarding.

I’m in.

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