Credit cards for down payment?

[Alex Kesner]

I vaguely remember hearing on a BP podcast about someone using credit cards for financing.

Am I crazy or do people do this? To me it could be cool to use a CC and get the perks of having points for travel & such (thinking SkyMiles). The only thing is paying the CC off by either refi or rolling cash flow into the payments.

I’m brain dumping here but would love to hear any thoughts!

[Nathan Gesner]

Just because someone said it on the internet doesn't mean it's good advice.

I use credit cards to earn points. I've taken six trips in the last two years, most with my wife and one with a family of six to Hawaii, and they were all paid for by points. I still have almost 500,000 points saved up and hope to top 1 million next year.

HOWEVER . . . we do this through ordinary business spending and we always pay our balance in full. Every. Single. Month. We never carry a balance or make interest payments. If we don't have the cash to pay for something, we don't buy it. That goes for the new computer at the office, the new Traeger grill for home, or the kitchen cabinets for our flip. If you have cash, you charge it to a card to earn points and then pay the card off with the cash.

Credit can be a powerful tool for the financially disciplined. They are powerfully damaging to the undisciplined.