When these cards first came out, I was excited about the mortgage thing. I thought, finally! But a lot of existing Built card users were not happy about the changes to how you earn rewards. The updates were confusing, and the backlash was intense. So, Built quickly came up with a simpler version.
Now that the cards have been out for a couple of weeks, I want to take a closer look at what makes the Built 2.0 card so complex, how the changes have made it easier (or not), and whether these cards are worth getting.
Let's cut to the chase. The Built Blue has no annual fee, the Obsidian is $95 a year, and the Palladium will run to $495 a year. Now, you can earn points for paying your mortgage, which you couldn't do before. Plus, there's no limit to how many points you can rack up, and you can use these cards for both mortgages and rent.
So, what's the problem? Well, figuring out how to earn points from rent got complicated. Overnight, current Built card members lost an easy way to get a few thousand points each month just by paying rent.
With the new Built cards, here's the deal: you can spend 75% of your mortgage or rent money like regular spending. So, you earn Built Cash at a rate of 4% on all the cards. You can then convert that Built Cash into Built Points. The points you get specifically from your mortgage and rent spending are at a ratio of $3 Built Cash to 100 Built Points. Just remember, it's a ratio, not a minimum.
Or, you can spend up to 100% of your housing costs as non-housing spending, and you'll be able to get up to 1.25x the points deposited into your account. Confusing, right?
Basically, current card members now have to spend money using the Built card, using it as their main credit card, to unlock all the points they used to get from rent. Before, they just had to swipe the card five times and that was it.
Let's look at an example. Imagine you pay $1,000 in rent each month. With Built 1.0, you could get 1,000 Built Points by simply swiping the card five times. You could buy five bananas over five separate transactions.
With Built 2.0, you have two options.
Option One: Spend 75% of your housing expense on other things. If you spend $750 outside of rent, you get 1,000 points. If you spend $1,000, you get 1,250 points. But if you spend nothing, you get zero points.
Option Two: Spend up to $750 outside of rent. Spending $750 earns you $30 Built Cash, which you can exchange for 1,000 Built Points earned from rent. If you spend nothing, you get zero points. If you spend $375, you'll get 500 Built Points.
Why the changes? My guess is that Built wasn't making enough money off people who were just buying five bananas and getting thousands of points from paying rent. Wells Fargo was supposedly losing millions on the Built portfolio because people weren't carrying a balance and getting charged interest (which is a good thing).
Basically, Wells Fargo and Built were eating the cost of people's points on rent because they weren't using the cards for anything else besides rent and the five-swipe minimum. Credit cards make money through transaction fees. With the 2.0 cards, they need to make the product more sustainable by requiring people to actually spend on the cards to unlock those rent and mortgage points.
So, who loses? Several groups.
- First, the Built 1.0 cardholders who only swiped the card five times a month to get their rent points and never used it for anything else now lose out.
- Second, current Built 1.0 card members who can't spend enough to get the maximum points also lose. They'll still get some points, but it won't be as easy as before.
- Third, people who chase credit card bonuses by spending on different cards will have a tougher time with the new Built cards.
Who wins?
- Anyone with a mortgage wins big because they can now turn their biggest monthly expense into points. Real estate investors and parents who pay both their mortgage and their kids' rent also benefit.
- Anyone who spends money outside of their mortgage or rent on a credit card wins because any amount of spending unlocks the potential to earn points. High earners and high spenders benefit the most.
- Built and Cardless win by bringing on more profitable customers.
As for me, I'm getting the Built Palladium to pay for my mortgages and earn Built Points. It means I have to spend money. With a $3,000 mortgage, I have to spend up to $2,000 outside of that to get the points.
If I don't hit that spending goal, it's a sliding scale. Spend $1,000, get 1,500 points. Spend nothing, get zero points.
So, what should you do? That's up to you.
Do you have a mortgage or rent? Do you want a chance to earn points from it?
If you're a Built 1.0 card user who just swiped five times and got your points, you're getting the short end of the stick. I believe you should vote with your wallet and not get any of the Built 2.0 cards. If you're in that camp, these new cards aren't worth it.
Back in 2022, we didn't get any points for paying rent, and we were fine with it. Instead of getting the Built Obsidian card, which earns 3x on dining and 2x on travel, get the Chase Sapphire Preferred. Or, instead of the Built Palladium card, which earns 2x everywhere, get the Venture X. Chase and Capital One offer cards with the same earnings without all the complicated math.
If you're faced with a subpar product that doesn't offer value, avoid it.
What if you spend some money each month but can't spend enough to get all the points? Is some points from mortgage and rent better than zero?
I think it is. But I hate how these cards make earning points on mortgage and rent so hard to understand. Still, if you spend any amount of money outside of mortgage and rent on a credit card, this card offers upside potential with minimal downside penalties.
If you don't spend money on this new Built card, you don't get your points from mortgage and rent.
No, but this isn't fair.
I know this isn't fair but only Built even thought of the idea of giving us a chance to earn points on mortgage and rent without paying some transaction fees. All other cards that once gave points for mortgage or giving points for free, went bankrupt within a year.
With the Built Palladium, you can earn a signup bonus of 50,000 points after spending $4,000 in the first three months. You'll also get gold elite status for the year and $300 of Built Cash, which you can use for things like lift credits, hotel bookings, and fitness classes.
The signup bonus for Built is rare, so keep that in mind.
This card earns 2x on all purchases, which is on par with industry leaders such as the Capital One Venture X.
You can also stack this card with a cashback portal like Rove Miles to earn even more rewards. Rove Miles lets you earn up to 50 or 60x on some hotel bookings and is transferable to airlines as well.
Now, here is earning points on mortgage and rent, there are two options.
- Option one allows you to earn up to 1.25x on all mortgage and rent spent with no cap on the total number of points you can earn and no transaction fee.
- Option two, earn 4% back as Built Cash on all purchases. You can also earn up to 1x on all mortgage and rent spent with no cap and no transaction fee.
Now, lets drill down on how the mechanism on this card work and then the math of option one and option two.
So, the mechanism of how you're going to earn points on mortgage and rent.
You can either pay for mortgage and rent using the Built app straight through there or you can go to your apartment buildings website or the mortgage lenders website and if they have a native integration with Built, there's just going to be kind of a pay with built option. If your landlord isn't on there, Built can cut a check on your behalf, or you can use Vemo or PayPal. You'll still capture those points with no transaction fee.
You'll link your bank account with Built. The payment goes from your bank account to your landlord or mortgage lender.
This is great. With the 1.0 card, the charge for rent went against some people's credit limit, which hurt their credit score. Built is supposedly working on bringing that back, but I wouldn't do that. I don't want a high credit utilization every month because it accounts for 30% of your credit score.
If they bring it back so that it hits your credit limit, there still won't be any transaction fee.
With this card, you can earn up to 1.25x on your mortgage and rent spend if you spend a certain percentage of your housing spend every month on other things.
- Spend 25% of housing as non-housing, earn 0.5x points.
- Spend 50%, earn 0.75x points.
- Spend 75%, earn 1x points.
- Spend 100%, earn 1.25x points.
So, if you spending rate is $1,000 a month, spending $250 will get 500 point, If spending $500 as non-ren spending, you would get 750
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