Is the Lowe’s Credit Card Worth It?

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The Lowe's Advantage Card has some pretty good benefits if you're planning to do some projects around the house.

Like most national retailers, Lowe's has a co-branded credit card product its customers can obtain, called the Lowe's Advantage Card. Issued by store credit card giant Synchrony Financial, the Lowe's Advantage Card offers some pretty valuable perks.

Customers who charge Lowe's purchases to the card can choose between a strong everyday discount, or special financing terms, and the card has no annual fee. There are some downsides to consider as well, as the card isn't the best choice for everyone. Here's a rundown of the benefits and drawbacks of the Lowe's Advantage Card, as well as some alternatives you may want to consider.

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Note: This is about the Lowe's Advantage Card, which is the personal (non-business) version of Lowe's co-branded credit card products. There is also a business Lowe's credit card that is issued by American Express, and several forms of Lowe's business accounts.

Benefits of the Lowe's Credit Card

If you shop at Lowe's, or are planning to do some major home improvements, there are certainly some good reasons to add the Lowe's credit card to your wallet. Here are the top benefits of the Lowe's Advantage Card:

Excellent everyday rewards rate

The Lowe's Advantage Card has a great everyday rewards rate. Customers can get 5% off purchases on their cards, on top of any other applicable discounts. Even the best cash-back credit cards have everyday rewards rates in the 2% ballpark, and the cards that do offer 5% rewards do so only in rotating categories. So, a 5% rewards rate on purchases is rather competitive.

To be clear, this isn't cash back, but it's effectively the same thing. Instead of giving you 5% of your money back at a later date, your Lowe's purchases will simply cost 5% less than they otherwise would.

You can take six months to pay for any big purchases

The interest-free financing option is good. On purchases of $299 or more, customers have the choice between the 5% discount or six-month deferred-interest financing. Considering that the Lowe's Advantage Card's standard APR is 26.99% as of this writing, this benefit can be far more valuable over a six-month period than the discount.

However, keep in mind that this is deferred-interest financing, not 0% intro APR financing. Here's the difference. If you have 0% intro APR financing, interest will only begin accumulating after the no-interest period expires. With deferred-interest financing, if you don't pay the balance in full before the promotional period ends (within six months, in this case), interest will be charged to your account retroactively from the date of the purchase. In other words, this benefit is only valuable if you pay the purchase off in full within six months.

It's also worth mentioning that there are often promotional deferred-interest financing offers with longer terms, such as 12, 18, or even 24 months. However, the six-month option is always available.

Project financing -- like a personal loan, but likely with a lower APR

Lowe's Advantage Card customers also have the ability to request "project financing," which provides extended, low-APR repayment terms. As of December 2018, the project financing terms that are available include 36 fixed monthly payments at 3.99% APR, 60 fixed monthly payments at 5.99% APR, and 84 fixed monthly payments at 7.99% APR. These are available on purchases of $2,000 or more on the Lowe's Advantage Card, and to be perfectly clear, project financing needs to be requested -- it isn't automatic. And it can't be combined with the 5% everyday discount.

No annual fee

The Lowe's Advantage Card has no annual fee, so it won't cost you anything on an ongoing basis to take advantage of the card's benefits. Most store credit cards don't charge an annual fee, and the Lowe's Advantage Card is no exception.

Potential drawbacks of the Lowe's Advantage Card

While there are certainly some good reasons to use the Lowe's credit card, like most credit card products, there are a few notable drawbacks as well. Here are some of the major negative factors to keep in mind when deciding whether or not to apply for the Lowe's Advantage Card.

  • The card's introductory offer generally isn't great, especially when compared with what you could get from some of the best cash-back credit cards. It's not uncommon for cash-back credit cards to give introductory bonuses worth $100 or more after as little as $500 in spending. While the exact offers for the Lowe's Advantage Card change, they are usually in the ballpark of $25 off the first purchase with the card.
  • It's only useable at Lowe's and online. This one is rather obvious but is worth mentioning. The Lowe's Advantage Card is truly a store credit card. It is not part of a major credit card network, such as Visa or Mastercard, and can therefore only be used for Lowe's purchases. However, there is a business version of the Lowe's credit card that is issued by American Express and can be used everywhere Amex cards are accepted.
  • The Lowe's Advantage Card has an above-average interest rate. While the card's standard APR can change over time, for context, consider that the standard APR is 26.99% as of this writing. This is about 10 percentage points above the U.S. average credit card APR. So, unless you take advantage of one of the special financing deals I mentioned or pay your bill in full every month, the Lowe's Advantage Card can become an expensive way to pay for purchases, even considering the 5% discount.

Is the Lowe's Advantage Card worth it?

The bottom line is that the Lowe's Advantage Card is a good credit card to have if:

  • You want the 5% discount and plan to pay your entire statement balance in full each month; or
  • You like the special financing terms, and are confident that you can pay the entire balance during the promotional period; or
  • You want to finance a high-cost home improvement project with a low fixed interest rate.

On the other hand, the Lowe's Advantage Card is probably not the best choice if you plan to carry a (non-promotional) balance from month to month, as you're likely to find lower-interest credit cards, especially if you have a strong credit history. Or, if you just want an all-in-one credit card that you can use at any merchant (not just at Lowe's), you should probably consider some of the alternatives.

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