I thought it was against the rule to use credit cards with annual fees?
The Best Credit Cards for Budget Hotels
Updated March 2013
Using points to find free award nights at hotels is just as important as redeeming miles for airline travel, since lodging expenses can represent a large portion of your vacation budget. Therefore, those who prefer to travel on rewards earned from their credit cards are sure to carry around at least one card co-branded with a hotel chain. While it would be nice to stay in luxury hotels on each vacation, awards for free nights at high-end properties can consume all of your hotel points in just one night of your trip. Accordingly, frugal travelers must seek out the best credit cards for awards at budget hotels. (See also: 40 Most Useful Travel Websites That Can Save You a Fortune)
What Makes a Good Budget Hotel Credit Card
First, look beyond the name of the parent company, as most large hotel chains offer properties under many different brand names. For example, the Marriott hotels contain luxury brands such as the Ritz-Carlton, as well as budget properties like Fairfield Inn. Next, compare the number of points earned from credit card spending with the minimum amount required for a free night award. Finally, look at other features the credit card may offer such as a generous sign up bonus or the ability to transfer points to airline miles.
Top Five Credit Cards for Staying at Budget Hotels
After considering their bonuses, point accrual, usability, and other factors, these are the best budget hotel cards currently available.
1. Starwood Preferred Guest Card From American Express
This fantastic card is likely to make any list of great credit cards for travel, and it is also a great card for budget hotels. Although the Starwood line of properties may be best known for their high-end Westin and mid-range Sheratons, they also feature less expensive brands such as Four Points and Aloft. There are several reasons why their credit card makes sense for budget travel. First, it features a 25,000 point sign-up bonus. Considering that their award nights start at only 2,000 points for a weekend stay, and 3,000 for a weekday night, the sign-up bonus alone can go very far. Furthermore, there are no blackout dates or capacity controls, and members receive their fifth night free when they book an award for four nights. Finally, the Starwood Preferred guest program is unsurpassed in its options to transfer points to miles with over 30 different airlines. This card has an annual fee of $65 that is waived the first year.
2. Hilton HHonors Card From American Express
Hilton is another good example of a brand with both luxury and budget properties. With free breakfast, free Internet service, and free local phone calls, redeeming points for a night at one of their Hampton Inns will cost you less money than an award night at a Hilton, which charges extra for each of these amenities. The standard HHonors card from American Express, with no annual fee, offers 40,000 points as a sign-up bonus. The HHonors Surpass version of this card has a $75 annual fee with a sign-up bonus of 60,000 points. With both cards, members will earn three points per dollar for most purchases, with six points earned on purchases from supermarkets, drug stores, gas stations, and telecommunications companies. An exceptional nine points per dollar is earned from purchases at one of their hotels. Awards start at 7,500 points, which is reasonable considering that they are earned at least three times as fast as with other cards.
3. Marriott Rewards Visa Card From Chase (Expired)
This is another hotel rewards card that gets new applicants off to a good start with a generous sign-up bonus. New cardholders will receive 30,000 bonus points as well as two additional free night stay certificates which are valid at any of their category 1-4 hotels. After that, card members will earn one point for each dollar spent, with three points earned at Marriott properties. Award nights start at 7,500 points, although they do offer PointSavers awards for as little as 6,000 points. Their budget brands include Residence Inn, Fairfield Inn & Suites, TownePlace Suites, SpringHill suites, and Courtyard by Marriott. There is a $45 annual fee for this card that is waived the first year.
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4. Choice Privileges Visa From Barclay’s Bank
This is the only card on the list that represents a truly budget hotel company, Choice Hotels. New cardholders will receive 8,000 points after their first purchase, and another 8,000 points when they use this card for a hotel stay. After that, they will receive two points per dollar spent on most purchases, with an outstanding 15 points per dollar spent at one of their properties. Award nights cost either 6,000 or 8,000 points. Although Choice Hotels is best known for budget properties in rural areas of the United States such as the Comfort Inn, they also have some fairly nice urban hotels in major European capitals that could make for some incredible award stays. There is no annual fee for this card.
5. Wyndham Rewards Visa Signature Card From Barclay’s Bank
This card offers new customers a 16,000 point sign-up bonus and two points per dollar spent on most purchases. Transactions at their hotels, which include Days Inn, Howard Johnson, and Microtel, among others, will earn five points per dollar spent. Reward nights start at 6,000 points, so their bonus is worth two free nights and almost enough for a third. There is a $49 annual fee for this card, but there is also a no-fee version that awards slightly fewer points.
Which Card Should You Choose?
The Starwood card is the clear winner, as it is the easiest one with which to earn free nights, and it offers incredible opportunities to earn airline miles. I recently redeemed a mere 10,000 points for three free nights at a Sheraton Suites location in Florida. Nevertheless, Starwood hotels probably have the smallest selection of budget properties of all the major brands. With 15 points earned per dollar spent at their hotels, the Choice Privileges Visa may offer the best deal for those using their card to pay for stays at affordable properties. Hilton’s sign up bonus, worth as much six free nights, is also a competitive offer. Finally, the Wyndham and Marriott cards may make sense for those who are loyal fans of those brands.
There is value in credit card rewards for budget hotels, but savvy cardholders must closely examine each card’s terms in order to find the true deals.
If you know for sure that you will be traveling in the future and will be staying at a hotel covered by the rewards card, then you can see if the reward outweighs the annual fee.
Take the Starwood card for example. Jason points out that you get a 25k point signup bonus, and you can get free hotel stay at 2-3ks. So just by signing up you've earned 10 free hotel stays.
Just one free hotel stay is worth more than $65, which is the cost of the annual fee.
