Why not use home depot credit for rehab?

I see a lot of you use HML for rehab money to fix up a home, but if all it needs is cosmetic work why not just put it on something like a home depot or lowes card and get your paint and stuff there? Wouldn’t that be much easier? Plus you can usually get 6-12 months no interest on your purchases. Is there a reason people don’ t do this as I have never seen it mentioned here before.

You can do this, but you will find that the cards have limits and much of it depends on how big of a rehab that you do. The repairs on my second rehab were done by that method. Bought for $30,000 with $12,000 on the credit card and an appraisal at 65,000 in two months working part time on it. I need to find more deals like that one instead of the major remodel that I am just completing. People have even put there down payments on cards.

There are several major draw backs, one is the interest rates are typically higher. It can also affect your credit rating if you max out the cards. This is dangerous and I would not recommend it for a major rehab.


Given that the interest is high, how long does a rehab (typically) take for a home that is structurally sound but basically just needs new paint, some bathroom tiling, a couple door repairs, windows, etc.? If it didn’t take more than say, 6-months, it would seem much less red-tape than doing ‘draws’ on a Rehab loan, right?

Does Home Depot or Lowe’s offer a different card rate or limit when you apply for the card under your LLC company name?

yes, I have done it and have card with both of them.

However, you MUST be CAREFUL if you do this! You MUST be able to pay it off before the promotional period expires; otherwise you are hosed!

I have very good credit so I have a high limit with both Lowes and HD, but I did a big rehab and it has taken me 6 months longer to sell the house than I planned so I had to pay them off with other resources (HELOC at a very low rate).

They are really good to do a minor/moderate rehab on a rental that will cash flow after its done. Doing a big rehab that you will sell…you need to be careful and have some resources that will enable you to pay it of and care the debt at a reasonable level.(selling family members or yourself into slavery is not in this category).

So, yes its do-able, but exercise a good bit of caution.

It helps alot if you have a home garage or storage shed where you live that you can use to stockpile items. I buy most of my materials from Home Depot or Lowes when they are on sale. Also, look for scratch and dent centers for new appliances. Good luck to you.