Rocket Credit Card Review: High Rates, Less Than Stellar Value
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3.7
The card boasts a high rewards rate on all spending — but you're better off searching for a low rate on your home loan and more flexible rewards on your credit card.
Pros
High rewards rate
Sign-up bonus
Cons
Annual fee (unless you have a Rocket Mortgage)
Varying reward values
on Rocket Card's website
Detailed review: Rocket Visa Signature® Card
The Rocket Visa Signature® Card, issued by Celtic Bank, was introduced in early 2023 with the promise to help customers “swipe or tap [their] way to a new home.” And while, no, you can't use the credit card to directly pay your mortgage, you can redeem the rewards it earns — a healthy 5 points back on all purchases — toward an eligible mortgage.
But the value of those rewards hinges on a few factors, including what you're using them toward, but also whether you're a new or existing Rocket mortgage customer. (If you have no intention of taking out a mortgage with Rocket, you can still get the card — but you'll owe an annual fee for it.) There's also a cap on how many points you'll ultimately be able to use toward your mortgage.
The truth is that if you're in the market for a home loan, you'll save more money by shopping around for the best interest rate, rather than shopping around for a credit card. And when it comes to the latter, in most cases you’ll be better off with a straightforward cash-back credit card that earns rewards you can use however best fits your budget.
Also worth noting: If you’re a resident of a U.S. territory or New Hampshire, the Rocket Visa Signature® Card is not available to you.
The Rocket Visa Signature® Card isn't the first to allow the redemption of rewards toward a mortgage. The defunct Wells Fargo Home Rebate Card also had a similar feature.
Rocket Visa Signature® Card: Basics
Card type: Rewards.
Annual fee: $95, waived for cardholders who have an existing, serviced mortgage with Rocket Mortgage.
Sign-up bonus: Receive a $200 statement credit when you spend $3,000 in the first 90 days.
Rewards: 5 Rocket Rewards points per $1 spent, regardless of the spending category.
Redemption options: You can use your points in the following ways:
Offset the cost of a new Rocket mortgage at a value of 1 cent per point, or 5% back. Terms apply, see below.
Apply points toward your existing Rocket mortgage loan. If you’re already a Rocket mortgage customer, you can redeem points toward the principal on your loan at a value of almost half a cent per point, equivalent to 2% cash back.
Redeem points through statement credit at a value of a quarter of a cent per point, or about 1.25% back. If you aren’t a Rocket mortgage customer and don’t plan to be anytime soon, this is your only option for redeeming points.
APR: The ongoing APR is 20.49%-30.99%, Variable APR.
Foreign transaction fee: None.
Benefits and perks
Solid sign-up offer
If you’re a Rocket mortgage customer, the card's introductory offer is in line with the value you’ll get from other rewards credit cards that waive the annual fee. But note that you can’t earn that sign-up bonus by using the card to directly cover your down payment, closing costs or monthly mortgage payment with Rocket (nor can you use the bonus toward those expenses either.)
Only points earned through other regular spending can be used toward mortgage costs.
Good reward values for new Rocket mortgage customers
The Rocket Visa Signature® Card is most valuable for newly minted Rocket mortgage customers, who can redeem their points toward that new loan at a value of 1 cent per point, or 5% back. That's an impressive rate, as most cash-back cards that offer 5% back do so only in select spending categories. When used this way, points can be applied to the down payment, closing costs or fees on a new Rocket mortgage, up to a cap of 800,000 points (or $8,000 in value). Refinances are excluded.
Existing Rocket mortgage holders can also redeem rewards toward the principal on their loan, albeit at a lower value per point. Instead of an effective 5% cash-back rate on your purchases, you'll be getting a 2% rate — still good, but available elsewhere on other cards.
Access to helpful features
As a cardholder, you’ll get access to Rocket Money, a personal finance app that can help you get a clear view of your finances. The Rocket Money functionality is integrated into the Rocket Visa Signature® Card experience, according to the card's website. It keeps you updated on your credit utilization; your monthly spending; subscriptions that can be canceled in the app; and bills that can be reduced to save money.
Also, if you choose to use card's SmartPay feature, it can automatically pay down your balance regularly and on time to avoid interest charges. It also keeps your credit utilization low, which is a key factor that impacts credit scores.
Drawbacks and considerations
Poor value for non-Rocket mortgage customers
If you're not a Rocket mortgage customer and have no plans to be, there's little reason to get the Rocket Visa Signature® Card. You'll be subject to an annual fee, and in exchange you'll be earning a flat rewards rate equal to about 1.25%, which simply isn't competitive. You’ll be better served by any number of no-annual-fee credit cards that offer 1.5% cash back or higher on all purchases.
Frankly, even if you're an existing Rocket mortgage customer and earning an effective 2% rate, you can find cards that are just as valuable, and more flexible. The Wells Fargo Active Cash® Card, for instance, has a $0 annual fee and earns 2% cash back on all eligible purchases. It also offers a sign-up bonus: Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months. You can put that cash back toward whatever expenses you like, mortgages included. Moreover, unlike the Rocket Visa Signature® Card, it has a promotional APR offer: Get a 0% intro APR on Purchases for 15 months and 0% intro APR on Balance Transfers 15 months from account opening on qualifying balance transfers, and then the ongoing APR of 20.24%, 25.24%, or 29.99% Variable APR.
Strings and limitations
The card’s highest effective earnings rate — 5% back when you apply rewards toward new Rocket mortgage costs — can sound tempting. Even so, you’ll need a lot of credit card spending to make progress on the cost of your new home. Consider this:
You can apply up to 800,000 points toward the cost of your new Rocket mortgage transaction, equivalent to $8,000 in value. That's nothing to sneeze at, but to hit that points cap, you would need to spend an eye-popping $160,000 on the Rocket mortgage credit card before applying for a new mortgage.
If you want a card that offers a high cash-back rate and the flexibility to redeem rewards however you need to, consider the $0-annual-fee Chase Freedom Flex℠. It earns 5% cash back in bonus categories that rotate every three months (on up to $1,500 per quarter in spending, then 1%). Beyond that, you also get the following ongoing rewards categories that don't change: 5% back on travel booked through Chase; 3% back at restaurants and drugstores; and 1% back on other purchases.
You may feel 'locked in' to Rocket
Other than purchase price, the interest rate on your mortgage is the single biggest factor determining how much you’ll pay for your home. That means shopping around for the best rate is critical to reducing your total cost of homeownership.
Rewards from the Rocket Visa Signature® Card may save you a few dollars on the down payment, fees or closing costs for your new home. But if a different lender offers a better rate — even by just a few decimal points — choosing that lender will save you far more over the life of your loan than any credit card points could.
And interest rates on mortgages fluctuate constantly. So even if Rocket offers the best rate when you start shopping for a lender, that may not be the case by the time you’re ready to take out the loan. The company does offer an option to lock in your interest rate for up to 90 days while you’re shopping for a home. But even if you snag that rate, how much will you realistically spend on your credit card over a 90-day period?
No intro APR promotion
As a new homebuyer, you might welcome some breathing room on credit card interest as you buy items to furnish your abode. But the Rocket Visa Signature® Card doesn't feature a 0% intro APR offer, and like most rewards credit cards, its ongoing interest rate is high. If you can't pay off the balance in full every month, then you'll find yourself owing interest on two new loans instead of just one.
A card like the $0-annual-fee Blue Cash Everyday® Card from American Express may be a better pick. It can offer a 0% intro APR for 15 months on purchases and balance transfers, and then the ongoing APR of 19.24%-29.99% Variable APR. It also earns 3% cash back at U.S. supermarkets; 3% back on U.S. online retail purchases; and 3% back at U.S. gas stations, on up to $6,000 spent in each category per year. Eligible purchases outside of that earn 1% back. Terms apply.
If you’re determined to pay your mortgage with a credit card, workaround services like Plastiq make this option possible. However, the cost of these services will generally outweigh any ongoing credit card rewards you would earn.
You'll earn 2% cash back on all purchases, and it doesn't matter how you redeem those rewards or how long you've been a customer.
How to decide if it's right for you
While the Rocket Visa Signature® Card promises a high rewards rate, it lacks flexibility, and its usefulness is limited in terms of actually helping you afford a home.
Plenty of straightforward cash-back credit cards earn at least 2% back with no annual fee, which you can apply indirectly toward closing costs or mortgage payments regardless of which lender you choose. For most customers, that flexibility will be the better bet.
on Rocket Card's website
