Home Depot Credit Card review: Your home reno and credit-building partner in crime

The Home Depot Credit Card is one of a few big brand-name home improvement credit cards out there. With no annual fee and a 0 percent introductory rate on financing for the first six months to two years (for purchases over $299), this card might not be a bad choice for people who struggle with credit, as it’s pretty easy for people with average credit to open.

And as long as you keep the card open and in good standing, you don’t have to use it for regular purchases, which is a great way to build credit over time and get to a place where you can be approved for some of the best credit cards.

However, like many store credit cards, missing payments or underpaying your Home Depot card bill can have expensive consequences, such as high interest charges retroactively tacked on to your purchase amount. With no ongoing rewards and high penalties for mistakes, many people might choose to open a non-branded alternative.

Quick highlights

• Rewards Rate: N/A
• Welcome Offer: New cardholders can get a discount of $25 to $200 on their first purchase, depending on how much they spend
• Annual Fee: $0
• Purchase Intro APR: New cardholders pay 0 percent interest for 6-24 months on purchases of $299 or more.
• Balance Transfer Intro APR: N/A
• Regular APR: Between 17.99 percent and 26.99 percent variable

This card is best for Home Depot loyalists, as well as people who are looking to build or improve their credit at a lower cost. With no annual fee or minimum balance requirements, cardholders can practically forget about it and still reap the benefits of building credit.

The Home Depot card is also a smart option for financing big home improvement or renovation projects for the home, patio or backyard. With one-year hassle-free returns, cardholders get a full 365 days to return purchases for a full refund, which offers DIY-ers both convenience and peace of mind.

Current welcome offer

As an incentive for new cardholders, the Home Depot card offers a small sign-up bonus, but it’s less than what many similar cards offer. What new cardholders do get is a discount of $25 to $100 off their first purchase, depending on the amount spent. This discount could be good news for a strapped-for-cash college student, but maybe not so much for a well-established professional.

This card also offers an introductory 0 percent APR for between 6 and 24 months on purchases of $299 or greater (17.99 percent to 26.99 percent variable APR thereafter), depending on your credit standing. Again, this offers some wiggle room for financing but can carry high interest penalties for one small payment mistake.

Rewards rate

It wouldn’t be unusual to assume a big brand store like Home Depot would offer credit card rewards for spending money on their most expensive items. After all, home improvement projects can quickly add up, and with more people spending time at home, remodeling projects are on the rise.

Unfortunately, that isn’t the case with the Home Depot card. It doesn’t offer any ongoing bonuses or rewards program, which means many cardholders will end up using a different rewards credit card for those bigger purchases. If you’re hoping to earn points on the dollar, you won’t get that here.

Some might argue the biggest benefit this card offers is its low barrier to entry. With fairly easy approvals and a $0 annual fee, it can be smooth-sailing for someone with less-than-great credit. There are also a couple of other primary perks on this card to note.

Deferred interest

One nice benefit of this card is the ability to defer interest for up to six months on purchases greater than $299. For cardholders who need a little more time to pay off major purchases, this can be a practical option — but only if you actually pay off the balance in full and on time.

While it’s a great perk to be able to put off paying interest on big-ticket items, if you underpay or pay late, even by a little, you’ll get hit with a high-interest fee, added to your original purchase — which could be a credit destroyer in the long run for some.

Special financing during promotions

Another advantage is the ability to get special financing for up to 24 months — but this is applicable only during special promotions, which may or may not help depending on your project’s timeline. In this case, deferred interest penalties also apply, so if you don’t pay off the balance in full at the end of the promotion, you’ll be subjected to a high-interest fee getting added to your purchase.

As far as credit card fees go, the Home Depot card is the middle of the road. While it doesn’t charge an annual fee or any other type of maintenance fee, the high interest charges you can rack up for late or missed payments can be steep.

Generally, store credit cards aren’t known for offering the best value, thanks to their high APRs. But for true Home Depot fans, the Home Depot card makes sense. Without that annual fee and some extra time to pay off bigger home improvement purchases, it’s almost a no-brainer for regular shoppers.

However, before making a decision, you can check out other credit cards that earn decent rewards.

The Home Depot Consumer credit card vs. Prime Visa credit card

One of the first notable differences between the Home Depot card and the Prime Visa is the spending accessibility. While both are store credit cards, the Home Depot card limits consumers solely to purchases at Home Depot. This factor could be ideal for the consumer who spends most frequently at Home Depot, but could be limiting for the person who casts a wider net on where they spend the most.

The Prime Visa offers a windfall of rewards for various purchases at Amazon.com and Amazon-affiliated businesses. For example, with an eligible Prime membership, you could earn 5 percent back on purchases at Amazon.com and Whole Foods Market. The added perk for the Prime Visa is that you’ll also earn rewards in other spending categories that aren’t Amazon-centric, such as 2 percent back on eligible purchases at restaurants, gas stations and drugstores, as well as 1 percent back on all other purchases.

Some drawbacks for the Prime Visa include the required Prime membership on your Amazon account to access the highest reward returns. This membership cost is $14.99 a month or $139 a year and there are no intro APR periods available on purchases or balance transfers. The threshold for approval is also higher for the Prime Visa, requiring at least good to excellent credit for feasible approval. The Home Depot card in this case wins out on affordability, since it has no annual fee and an intro financing period on purchases of $299 or more for six to 24 months. If Home Depot is your store of choice, you’d be better off with the Home Depot card in terms of card accessibility and affordability. If you want a bit more leg room for where you get to spend or if earning cash back is a big deal to you, the Prime Visa is worth a closer look over the Home Depot card.

The Home Depot Consumer credit card vs. Capital One Walmart Rewards® Mastercard®

Both the Home Depot card and the Capital One Walmart Rewards Mastercard* are store credit cards with steep ongoing APR rates and the same credit requirements for approval. Deciding which one fits better in your wallet will depend on which store wins the bulk of your purchase power.

Neither card charges an annual fee, but a key difference between the two is the opportunity to earn rewards. If Walmart is your grocery store of choice, you can earn a significant 5 percent back on purchases at Walmart.com. You can also cash in with 2 percent back at physical Walmart stores, eligible purchases at fuel stations, restaurants and even on travel. Finally, similar to the Prime Visa, you can earn 1 percent back in rewards wherever Mastercard is accepted, which is almost everywhere else. Boost the card’s value even more by using Walmart Pay, where you’ll be able to earn 5 percent back in Walmart stores for the first 12 months.

Another difference in these two cards is the presence of a 0 percent intro offer. The Home Depot card has 0 percent intro financing on purchases totaling $299 or above while the Capital One Walmart Rewards card doesn’t have any intro offers. However, the Capital One Walmart Rewards is more forgiving if you happen to make a late payment given that there is no penalty APR (though any late payment on any credit card will be detrimental to your credit score). Your home renovation projects will be better suited for the Home Depot card, since you’ll get substantial financing options there. However, if you want to add groceries and reward earnings to your list of musts in a credit card, the Capital One Walmart Rewards is one of your best bets on the market.

Best cards to pair with the Home Depot Credit Card

Since this card doesn’t offer regular bonuses or an ongoing rewards program, many cardholders will want to use it along with their regular cash back or rewards card. And because this card works only at Home Depot, it makes sense to have a different credit card that earns rewards or wait to build credit with this card before opening up a better card. Something like the Bank of America ® Customized Cash Rewards credit card could be an ideal fit once your credit score reaches the good to excellent range, as you’d get to choose which of the eligible spending categories you’d earn the most in and tailor your spending accordingly so you get the most bang for your buck.

The Home Depot card could be a decent choice for some people, depending on their credit situation. For those looking for a great rewards card, however, this isn’t it.

This card is best for die-hard Home Depot brand lovers who are going to shop at Home Depot on a regular basis no matter what, as well as those who might face challenges opening a credit card with better benefits.

Regardless, anyone who opens this card will need to be mindful of making payments on time.

*The information about the Home Depot Credit Card, and the Capital One Walmart Rewards Mastercard has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.