Investor · Kusatsu, Shiga · Member since 2015 · 147 posts · 87 votes
Hi guys,
So, I pay around $5000 a month in mortgage payments for my SFH rentals. I was thinking that I could basically meet the minimum spend for sign up bonuses on cards if I use a company like Plastiq that allows you to pay for services, like rent and mortgages, with your credit card. They charge a 2% fee, but the sign-up bonus will most likely be greater than that. Has anyone done this? Any tips?
Investor · Arlington, VA · Member since 2012 · 1k+ posts · 491 votes
7y
Some of the sign up bonuses are worth way more than $500. I just flew round trip to Europe in Biz class using points. Retail value of tickets were $9k each way. $2k in economy. This is simple and straightforward to do with plastic.
Real Estate Agent/Investor · Peoria, AZ · Member since 2016 · 2k+ posts · 2k+ votes
7y
That's a lot of work for $100-$500 in bonuses per card. You may get a few hundred dollars out of it I suppose, but your credit will take a hit for numerous inquiries and numerous new accounts.
Investor · Arlington, VA · Member since 2012 · 1k+ posts · 491 votes
7y
Some of the sign up bonuses are worth way more than $500. I just flew round trip to Europe in Biz class using points. Retail value of tickets were $9k each way. $2k in economy. This is simple and straightforward to do with plastic.
Investor · Arlington, VA · Member since 2012 · 1k+ posts · 491 votes
7y
@Mark S. I love Chase (Reserve, Ink preferred, Ink cash, and Freedom) as well as American Expresss (Platinum, Gold, Blue Cash, and Hilton Aspire). I’m military though so I pay no annual fees, but I’ll keep them when I get out in a few years. The business cards don’t show up on my credit report which makes them extremely valuable to me for rehab projects in order to keep my overall utilization down and not affect my credit score for new loans. The ability to travel hack with my normal spending is so awesome to me. One sign up bonus can generally pay for an amazing trip on the right card.
Rental Property Investor · KY · Member since 2013 · 1k+ posts · 537 votes
7y
Thanks @Frankie Woods, I’m working on getting my Southwest Companion Pass with Chase’s Southwest card. I also have Chase Freedom. Seems like there used to be a way to transfer Chase Ultimate Rewards points to Southwest but it appears that’s no longer available - at least from Freedom card.
Investor · Arlington, VA · Member since 2012 · 1k+ posts · 491 votes
7y
@Mark S. no problem! The southwest card is amazing but I don’t have a significant other so its less useful for me. You can transfer UR with the chase preferred card (95 annual fee) and that allows you to transfer points from the freedom as well.
Investor · Kusatsu, Shiga · Member since 2015 · 147 posts · 87 votes
7y
@Frankie Woods, so how often do you sign up for new cards? In my case, if I pay my mortgages with a card, I could probably meet most minimum spends in a month, but signing up for a new card every three weeks will probably effect my credit. Do you just sign up for three at the same time so you only get one credit pull and then do that every three months?
@Sean McCluskey, that’s a good point. I wouldn’t want to sign up for a card and then not be able to use it to pay the mortgages.
@Frankie Woods I’ve read that only certain mortgage companies will work with Plastiq. Is that what you’ve found? How exactly do you use it?
That is true. I believe that only American Express now doesn't allow mortgage payments. You will get notified if the transaction can't be completed with the card. All you need is your payment information from your bill, which you enter into a "new recipient". They charge your card and mail a check to the mortgage company. It generally takes 5 - 8 business days for the payment to post to your mortgage account. It's fairly easy and a good way to meet your minimum spend. If it doesn't work, just pay ahead on your utilities (phone, electric, insurance bills, etc.)
@Frankie Woods, so how often do you sign up for new cards? In my case, if I pay my mortgages with a card, I could probably meet most minimum spends in a month, but signing up for a new card every three weeks will probably effect my credit. Do you just sign up for three at the same time so you only get one credit pull and then do that every three months?
@Sean McCluskey, that’s a good point. I wouldn’t want to sign up for a card and then not be able to use it to pay the mortgages.
I used to sign up for a new card every 2 - 3 months. The credit inquiries will impact your credit score, but not significantly (I maintained between 700 - 770 depending on the credit bureau with an average of 730). I have 16 over the past 2 years, and about 11 over the last year. The inquiries from the last year have the biggest effect. The biggest issue is that some credit card issuers (e.g., chase and american express) will not approve you if you have too many inquiries in the last 6 - 12 months. Discover and Capital One generally won't approve you if you have a lot of open accounts. There are several nuances. The generally strategy is to start with Chase due to their 5/24 rule (five personal cards opened in last 24 months) and finish with AMEX (has a one bonus per lifetime rule). BoFA, Wells Fargo, Barclays, U.S. Bank etc. are good for churning in the middle. It's a fun hobby but can be frustrating and trial by error at times.
Folsom, CA · Member since 2018 · 134 posts · 100 votes
7y
@Frankie Woods Hey Frankie, thanks for your service. Second, how do you open a card that doesn’t affect your credit? Does this require you open an llc or simply tell the bank it’s a business card? We just completed a rehab and had to put a portion on a card (0% interest) but it affected our credit slightly. Thanks!
Investor · Arlington, VA · Member since 2012 · 1k+ posts · 491 votes
7y
@Jeremy Blevins Thanks. You simply have to apply for a business credit card from banks other than Capital One, Discover, and TD [this list changes so it's best to google or check doctorofcredit.com, but I checked recently as of this post]. You will still need to provide a personal guarantee by giving your SSN, but it won't report on your personal credit report unless you default. You don't have to own an LLC. Technically any side-hustle counts (e.g., having a yard sale, selling stuff on eBay, etc.), but having an entity probably improves your odds of being approved. The hard inquiry will still appear on your personal credit, but it should only affect your score by 5 - 10 points. The utilization will not, which is awesome for those of use who like to BRRRR. Happy hunting!
Folsom, CA · Member since 2018 · 134 posts · 100 votes
7y
@Frankie Woods thanks for all the info! That’s great to hear. I might look into a business card so that we can transfer our renovation debt into it. Thanks again!
Rental Property Investor · Oak Park, MI · Member since 2013 · 222 posts · 35 votes
6y
@Frankie Woods are you using plastiq to close on deals , if so could you walk use thru use your business credit cards with plastiq to close , I just got my first set of business cards approved for 65k my first round . Please tell us
Investor · Arlington, VA · Member since 2012 · 1k+ posts · 491 votes
6y
@Tereal Wilsonn no, I haven't used plastiq to close on deals. However, it could work with hard money or private money. I'm very doubtful any bank would accept this. You could get a cash advance and place the funds in your bank account for 2+ months to season them. This would pass their under writing.
@Jeremy Blevins Thanks. You simply have to apply for a business credit card from banks other than Capital One, Discover, and TD [this list changes so it's best to google or check doctorofcredit.com, but I checked recently as of this post]. You will still need to provide a personal guarantee by giving your SSN, but it won't report on your personal credit report unless you default. You don't have to own an LLC. Technically any side-hustle counts (e.g., having a yard sale, selling stuff on eBay, etc.), but having an entity probably improves your odds of being approved. The hard inquiry will still appear on your personal credit, but it should only affect your score by 5 - 10 points. The utilization will not, which is awesome for those of use who like to BRRRR. Happy hunting!
Its a bit misleading to say that the business credit cards are not reported in your personal credit card because the hard inquires are posted on your personal credit card. Can anyone tell me if you can write to both the credit bureau and the credit card company to remove the credit card inquiry if its a business credit card under an LLC?
@Jeremy Blevins Thanks. You simply have to apply for a business credit card from banks other than Capital One, Discover, and TD [this list changes so it's best to google or check doctorofcredit.com, but I checked recently as of this post]. You will still need to provide a personal guarantee by giving your SSN, but it won't report on your personal credit report unless you default. You don't have to own an LLC. Technically any side-hustle counts (e.g., having a yard sale, selling stuff on eBay, etc.), but having an entity probably improves your odds of being approved. The hard inquiry will still appear on your personal credit, but it should only affect your score by 5 - 10 points. The utilization will not, which is awesome for those of use who like to BRRRR. Happy hunting
Its a bit misleading to say that the business credit cards are not reported in your personal credit card because the hard inquires are posted on your personal credit card. Can anyone tell me if you can write to both the credit bureau and the credit card company to remove the credit card inquiry if its a business credit card under an LLC?
No, you can not remove the hard inquiries from your personal credit report. The inquiry is needed by the bank to insure you are not a credit risk as they will go after you personally if your LLC defaults on the credit card. In essence, you provide a personal guarantee when applying for almost all business credit cards from the large banks.
After your business has established itself (>3 years in business & > ~$5 Million in revenue), there generally is no longer a need for a personal guarantee. At that time, there will no longer be hard inquiries on your personal report when applying.
The biggest benefit to having business credit cards is that they do not affect your credit score's utilization rate (which makes up ~30% of your score). Additionally, the balances are not provided to the bureaus, thus they don't affect your DSCR when applying for loans.
The hard inquiries will generally only affect you for the first year, and will drop off completely after 2 years.