Thread: Is Home Depot credit card a scam?

Is the Home Depot card application the worst choice you could make in 2013? You will see a number of reviews which allege it’s a “scam” or “ripoff” but those complaints are an exaggeration, because the card is legal. But that doesn’t necessarily mean it’s a wise choice!

The hook, line, and sinker

Let’s face it… home improvement isn’t cheap. Regardless of whether you shop at Home Depot, Lowes, or another store, there’s a good chance you will pony up some big bucks for whatever project you’re tackling.

And obviously, that can be painful on the wallet, right?

Stores like Home Depot play right into that pain, by offering you the “convenient” alternative of using their store credit card to pay. Their no interest offers may sound like a lifeline, until you actually understand how they work.

The “no interest if paid in full” explained
Buyer beware: This is not the same as the 0% you will find on major credit card offers.

As you see above, it says right there on the application how it works. Unfortunately many people don’t pay attention to this, nor do the customer service reps at the store always do a good job explaining it.

• To avoid interest charges, you have to pay off the full amount by the promotional end date (in the above example, that’s 6 months).
• If you don’t pay off the full amount within that timeframe, your Home Depot credit card account will be charged interest going back all the way to the date of purchase.
• Worse yet, all of the APRs are excessive, so that will be costly. As I write this review the advertised rates are 17.99% - 26.99% APR, but next to that they say this…

Major credit cards won’t do that
If you get a 0% offer from a Visa/MasterCard/Discover/AmEx, it won’t come with this deferred interest gimmick.

In other words, if you apply for a major bank card that offers 0% for 12 months, you will truly get 0% during that period, even if it takes you longer than that to pay it off.

This is why you should not apply for the Home Depot store. Instead you would be better off getting a regular bank card that comes with a 0% financing promotion. Here are 3 good sponsored alternatives I recommend:

1. Citi Simplicity – Comes with a long 0% offer and this card never charges a late fee!
2. Chase Slate – Offers a nice 0% promotion and is easier to qualify for than most of the other cards from Chase.
3. Capital One Platinum – 3 cards for credit ranging from average to excellent.

Rewards? Forget about it!
As if the financing offers weren’t disappointing enough, the Home Depot credit card doesn’t even offer a rewards program!

The best card for earning rewards at Home Depot stores is actually from Discover. Thru their ShopDiscover program, you can earn 5% cash back at homedepot.com:

So if you are a Discover cardmember and want to buy a fridge, faucets, doors, or anything else... just go to the Home Depot website through your Discover account and you will receive a full 5% cashback bonus on your purchases. Their website offers free in-store pickup, so you can buy online and then go pick it up at your local store.

Best of all, with the Discover it card (no annual fee) you can also save 5% in-store at home improvement stores during the quarter they are featured. To learn more, check out my Discover it review.

The 10% off promotion is extinct?
I remember a few years back, there used to be a promotion for the Home Depot card where you got 10% off the first purchase charged to the account. If you were spending thousands of dollars and had the ability to pay your bill in full, this was a fairly good deal as long as you were making a big ticket purchase.

Unfortunately I haven’t seen them offer in ages. It seems they stopped it a few years ago when the economy tanked and never brought it back since. I haven’t heard from anyone nor seen that 10% discount deal anywhere for several years now.

However as an alternative incentive, I have seen them tout a $25 statement credit for opening a new account. Being that there are credit card bonuses 10x higher, I think most people would agree a $25 statement credit is a total joke. Not to mention, the last time I saw them offer that was way back in 2011.

Conclusion?
Whether you’re after low interest rates or rewards, this is a rotten credit card all around. To add insult to injury, I hear the customer service is treacherous on it.

The only half-way logical reason I can think of for getting it is if your credit score is garbage and you need an easy to get credit card. If that’s the case, the Home Depot credit card requirements/qualifications aren’t too strict. But for anyone with average credit or above, you can do much better getting a card elsewhere.

we have had a home depot store card for several years and have used the 6 or 12 months 0% option a few times. The minimum monthly payments have always been the same each month, and then rest of the balance is due at the end of the term.

As of the Sept. 2011 bill, they raised the min. payment from 10.00 to 25.00. Being used to the 10.00 steady payment forever, I sent a check, which cleared my bank 7 days before the due date. The statement for Oct. came, and showed a 25.00 late fee was charged for Sept.

I called & they said they sent a letter in Aug. stating the min. payment was increasing. I never saw the letter, and with all the ad crap they put on their bills every month, you'd think they could put something on the bill about the increase.

They were not too anxious to reverse the charge.. said they would if the account was 'brought up to date'.... this is a sneaky way to gouge more money out of their customers, and potentially damage their credit. Be sure to read your bill very carefully, so you don't end up getting nailed, too.

Of you can go to the post office and get the 10% off coupons for Lowes and use them at Home Depot. The Discover card cash back 5% only applies to internet sales, not to sales from the store. The 6 mo SAC is a good deal on large purchases, though, when you plan to pay them off within that time frame. Another trick with Home Depot (and Lowes and Sears) - if you purchase online and schedule install, you pay tax. If you purchase in the store and they install, there is no tax.

Oh, and the 5% that Discover card offers on the More card - the Home Improvement category only lasts 2 months. And, there is a $500 cap on the purchases. So, if you go in and buy $1000 worth of merchandise, they will only give you 5% on the first $500 and then next $500 is at the 1% standard cash back bonus rate. No, you can't make two $500 purchases because the cap is for the duration of the promotion, not per purchase.

Gruntled if you sent the check 7 days before the due date and it was cleared by your bank, there should be no reason why you got a 25.00 late fee. Now if you wrote a check 7 days before the due date and they received it 7 days after the closing then this is a different situation.

did you go down to your store and talk to the manager explain the situation and showed them the date of your canceled check on your statement?

considering you areusing their card there, shouldn't be a problem they should not charge you a late fee. they should be grateful that your using there card and not your own private credit card.

Originally Posted by just-me-in-tn

Oh, and the 5% that Discover card offers on the More card - the Home Improvement category only lasts 2 months. And, there is a $500 cap on the purchases. So, if you go in and buy $1000 worth of merchandise, they will only give you 5% on the first $500 and then next $500 is at the 1% standard cash back bonus rate. No, you can't make two $500 purchases because the cap is for the duration of the promotion, not per purchase.

This is incorrect. The OP was referring to purchasing through ShopDiscover, which has a list of different retailers that customers can earn 5%-20% cash back on at all times (provided the sale goes through the portal on ShopDiscover). This is definitely separate from the 5% rotating categories offered every 3 months. In fact, for 2012 Discover More doesn't even offer home improvement as one of those categories-- probably that is the Citi Dividend you are thinking of. Dividend cuts your 5% off after only $500 per quarter, where Discover gives you $1500 at 5% before you get cut, had Home Depot been one of the categories.

scam sounds appropriate.

Not a fan of Home Depot Consumer credit card at all. i have had their card since 2008. i have made large purchases and paid them off. i had a $4500 credit line. they chose to decrease that on their own accord and for zero reasons to $2500. so....... that was an ugly hit on my beautiful credit. i called them up, and they said they did that for in-activity. hmmmmmmm.... greedy jerks.

so, i said kindly put it back to where it was. they said they would but would have to inquire hard to my credit. BOO!!! i said aint happening. and i closed my account - happily. I refuse to be abused by creditors when i have not abused them. i am building a business, and my credit is important and vital to my growth. i doubt i will ever strp foot in there again. i have lowes. lowes is closer, and that is the reason i did not use hd much. pound sand home depot.

What I dislike about the Home Depot card is that I can't set up recurring payments on the site; each month I have to log in and schedule a payment. Major bummer, but I only put up with it because of the deferred payments, and yes, I'm aware of their sneaky little ways.

For example, you can pay your balance in full, but if you happen to charge something between that time and the date your cycle ends, it's a deadzone for which you can get hit with a minimum finance fee. There's no grace period! Of course, the $1.50 is inconsequential, but it's their lack of principle that bugs me.

I have a Home Depot card with $10,000+ limit, and have used it for years. I own several investment/second homes, and use the card a few times a year (annual spring cleaning, update carpets/appliances when a tenant moves,etc), so each time I go to HD the bill is over $299. I have it set up on autobill pay for the minimum monthly payments, and take advantage of the 6 mo same as cash, then pay it off about a month before the six month period ends. It is a good way to track home improvement costs on one statement (compared to hunting each investment property expense on personal credit cards) and has worked great for me.