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Home Depot vs. Lowe’s: Financing Options For a Home Remodel Compared
Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.
Investing money in home renovations can be a wise decision if your budget allows for the expense. Home improvements can both increase the value of your home for resale or allow you to feel more comfortable in the space you’re living in. However, those improvements can run into hundreds if not thousands of dollars.
If you’re looking to start new work on your home, you may look into the financing options available at Home Depot and Lowe’s. Each store has multiple credit cards and loan products available, but each option is a little bit different. To help you decide which is best for you, we break down and compare each store’s financing options.
Home Depot financing options
Home Depot consumer financing options
The Home Depot Consumer Credit Card: The Home Depot Consumer Credit Card has a $0 annual fee and offers 6 months financing on qualifying purchases of $299 or more. No interest charged if paid in full during this period. The Home Depot Consumer Credit Card also offers financing for up to 24 months during select promotions. See the Home Depot website for more information on these offers.
After the first 6 months, the interest rate reverts to your standard APR, which will run from 17.99% - 26.99% variable. Interest will be charged to your account from the purchase date if the purchase balance (including premiums for optional credit insurance) is not paid in full within promotional peroid or if you make a late payment. This is called deferred interest, and it’s definitely something to avoid, so ensure you pay off the entire balance in time.
Home Depot Project Loan Credit Card: The Home Depot Project Loan Credit Card allows you to finance bigger purchases when you need to stretch out repayments over a longer period of time. This product extends your financing out for as long as 84 months, with a credit line that can be as high as $55,000 – depending upon your credit worthiness. The APR is fixed at a low rate that varies depending on how long you decide to finance your purchases. There is $-00 annual fee, and you repay purchases in fixed monthly installments.
Home Depot business financing options
Home Depot Commercial Revolving Charge Card: This is a charge card for business owners, which means that you’ll need to pay your balance off in full, but you have a full 60 days to pay, which can help optimize your cash flow. Cardholders will also receive fuel discounts, the ability to add authorized users, and a host of other perks that make this card a convenient financing tool for your business. Since it’s a business card, you may get access to a higher line of credit than you would with a personal credit card.
Home Depot Commercial Credit Card: The Home Depot Commercial Credit Card can serve as an easy way to keep all of your business charges organized. There is a $0 annual fee and the account carries many of the same features that are on the revolving charge card. The big difference is that full payment for all charges is due each month as shown on your billing statement. Instead of using revolving credit to pay off your bills over time, this is just a standard charge card.
Lowe’s financing options
Lowe’s consumer financing options
Lowe's Advantage Card: The Lowe's Advantage Card comes with different financing options. Save 5% off your eligible purchase, or get 6 months special financing with purchases of $299 or more, or get 84 fixed monthly payments with a minimum purchase of $2,000 at 7.99% APR. Terms apply.
But you should be aware that with the special financing deal, you will be charged deferred interest if you don’t pay your balance in full by the end of the 6-month period. Finally, if you need to stretch out more expensive projects over a longer period of time, you can take advantage of a very reasonable fixed APR for up to seven years.
It’s important to note that these three offers are mutually exclusive, so you won’t be able to take advantage of the 5% discount and promotional financing on the same purchase.
A great feature that the Lowe's Advantage Card offers is a consistent 5% discount off your everyday Lowe’s purchases. So if you regularly shop at Lowe’s, carrying this card in your wallet can help you score some major savings in the long run. But again, it’s important to note that the 5% discount cannot be used in conjunction with the other financing offers.
Lowe’s business financing options
Lowe's Business Credit Card: This $0 annual fee card can only be used at Lowe’s, but it allows business owners to share a credit line between multiple cards. The card offer a 5% discount for in-store purchases, plus the ability to receive discounted deliveries on store purchases or from LowesForPros.com.
Lowe's Business Rewards Card from American Express: For businesses that frequently shop at Lowe’s, the Lowe's Business Rewards Card from American Express offers a decent rewards program with a $0 annual fee. You earn 3X points on select business purchases, 2X points at Lowe's, and 1 point per dollar spent on all other purchases. You can start redeeming with just 2,500 points. You also get 5% off Lowe’s purchases, as well as discounted delivery fees when materials are brought to you by Lowe’s.
Points don’t have expiration dates and as a welcome bonus, new cardholders can earn a $100 statement credit upon approval and earn an additional $100 statement credit after spending $1,000 on your card in the first three months of card membership. You can redeem points for Lowe’s or Amex gift cards, gas rewards cards, and outdoor rewards cards that can be used at merchants including L.L. Bean and Cabela’s. You have the option of paying off your balance every month or you could carry a balance with an APR of 15.74% - 24.24% variable*.
If you get additional cards for employees you control their line of credit, and when they use cards your account earns the rewards. If you want a rewards card tied to Lowe’s, then this is the best way to go because it offers double points for shopping at Lowe’s in addition to a 5% discount. But if you don’t spend a lot of money at Lowe’s you might come out ahead by choosing another cash back credit card.
The Home Depot Consumer Credit Card vs. Lowe's Advantage Card
Since most consumers are already familiar with credit cards, the store-branded credit cards from each hardware store might be the first things that pique your interest. But is one better than the other?
What they have in common
Both cards come with $0 annual fee and the line of credit you get approved for will depend on your creditworthiness. For those looking to finance big purchases (like new appliances, for example), the consumer credit cards from both Lowe’s and Home Depot have some great options that allow you to pay no interest on purchases over $299 as long as your balance is fully paid off within 6 months.
What makes this feature stand out over normal credit cards is that this promotion is always available as long as you have the card; not just for an introductory period.
However, it’s important to be aware that if you carry a balance past the promotional period, interest will be charged on your balance from the purchasing date, known as deferred interest. Since the APRs are painfully high with 26.99% variable on the Lowe's Advantage Card and 17.99% - 26.99% variable APR on The Home Depot Consumer Credit Card, it could be very costly to roll over any remaining balance past the promotional period.
Where each card wins
Lowe's Advantage Card – 5% discount: A great feature that the Lowe's Advantage Card offers is a consistent discount off your everyday Lowe’s purchases. If you regularly shop at Lowe’s, carrying this card in your wallet can help you score some major savings in the long run. But it’s important to note that the discount cannot be used in conjunction with any promotion that allows you to pay no interest on balances paid off over time.
The Home Depot Consumer Credit Card – longer interest-free periods: The Home Depot Consumer Credit Card doesn’t come with a built-in discount feature, but it does give the chance to have interest-free financing on some purchases for longer than 6 months. According to its website, Home Depot runs special promotions throughout the year that will give up to 24 months of interest-free financing on select purchases, as long as the balance is paid in full before the promotional period is up. These special financing promotions can include broad categories like doors and windows, building materials, water treatment systems, and much more. Check out their website to find out what the current promotions are and how long they’ll last.
Which is best for you?
Choosing between the Lowe's Advantage Card and The Home Depot Consumer Credit Card will depend on your individual situation, but both cards offer good financing options for loyal customers.
If you’re looking for a drawn-out payment plan for a big home remodel project, then either one of these cards can give you up to 84 months of financing.
At first glance, you may find Home Depot Project Loan Credit Card to be a little more affordable than Lowe's Advantage Card because it has a tiered APR based on how much you borrow, while the Lowe's Advantage Card carries a 26.99% variable APR. Lowe’s does not explicitly state its maximum line of credit, but the minimum purchases requirement is $2,000 for its promotional offer. For the Home Depot Project Loan, your credit line can be up to $40,000 depending on your creditworthiness.
Best credit cards for home improvement projects
Even though they might be the first financial products that come to mind, the credit cards and loans from Home Depot and Lowe’s might not be the best option when it comes to funding a home remodel. Not only will these products pigeon-hole you into purchasing all of your products at one store, but when you crunch the numbers, there are a handful of low-interest credit cards and rewards credit cards that have more favorable terms and could save you a lot of money.
0% for 18 months on purchases at ANY retailer
Citi Simplicity® Card: As an alternative to the Lowe’s or Home Depot credit cards, the Citi Simplicity® Card comes with a $0 annual fee and currently offers an intro APR of 0% for 18 months on purchases and 0% for 18 months on balance transfers.
The ongoing APR is 14.74% - 24.74% (variable), which is lower than what you’d pay if you carried a balance on a store credit card, such as the two listed above. The other huge benefit when using the Citi Simplicity® Card instead of a Home Depot or Lowe’s credit card is that you can shop at any retailer and still enjoy an 0% APR introductory offer.
Maximize rewards on your big spending
Discover it® Cash Back: If you’ve saved up enough money to pay for your home remodel outright, then putting your expenses on a rewards credit card can help you bring in a huge chunk of cash back.
The Discover it® Cash Back card lets you earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate, 1% unlimited cash back on all other purchases - automatically.
For new card members, you can earn: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300. This generous sign-up bonus will give you a chance to save a lot of money on your home improvements by earning cash back on all of the purchases you make along the way.
To top it off, cardholders will also enjoy a low intro APR of 0% for 14 months for purchases (after that 11.99% - 22.99% Variable APR, which is twice as long as the Home Depot and Lowe’s credit cards.
Best of both worlds: Low interest and cash back rewards
Capital One Quicksilver Cash Rewards Credit Card: This is the perfect credit card for consumers who would like to earn cash back on their home improvement purchases AND enjoy the comfort of having a long intro period of interest-free financing.
The Capital One Quicksilver Cash Rewards Credit Card comes with an unlimited 1.5% cash back on every purchase, every day. You’ll also have an APR of 0% intro on purchases for 15 months (14.99% - 24.99% (Variable) APR, after), which means that you won’t have to worry about paying the full price of your home remodel all at once. There is a $0 annual fee with this card and a foreign transaction fee of none.
Other ways to finance home improvements
Home equity loan or line of credit: If your home is worth substantially more than what you owe on it, you may be in a good position to tap home equity for your home improvement project.
A home equity loan is a loan against the value of your home, with a fixed interest rate and a set repayment period. While a home equity line of credit also borrows against the value of your home, the interest rate is variable and you don’t have to use the full amount of the credit line all at once.
Home equity loans typically have lower interest rates than credit cards (except for 0% APR promotions). Managing expenses and sticking to a repayment plan is crucial should you decide to take out this type of loan.
Home improvement loans: Many banks, like Wells Fargo and Chase offer home improvement loans made specifically for these kinds of projects. The loans are often unsecured and used for some type of home renovation. Some banks will require the house to act as collateral on the loan. Keep in mind that a home improvement loan may have a shorter repayment term than a home equity loan or line of credit. Make sure you check the payment amounts and payoff dates before making your decision.
The bottom line
For homeowners, there are few things as rewarding as completing a home remodeling project. Whether big or small, home renovations are a wonderful investment because not only are you adding equity to your property, you also get to enjoy the new and improved living space! Funding a home improvement project can be tough, but Lowe’s and Home Depot each offer some unique financing options.
Choosing the best credit card will vary from person to person. While the Home Depot and Lowe’s financing options have their strong points, you may be better off with a standard consumer credit card like the Citi Simplicity® Card or a loan.
The information related to the Lowe's Advantage Card and the The Home Depot Consumer Credit Card has been independently collected by LendingTree and has not been reviewed or provided by the issuer of this card prior to publication.