How to pick the best hotel credit card

If you’re a frequent traveler, a hotel credit card can be a big help. Just know the pros and cons, and choose a hotel card that meets specific travel needs. (iStock)

Getting a hotel or travel credit card can be a powerful financial tool in a globetrotter's wallet if leveraged correctly.

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By and large, credit cards provided by hotels offer free stays, room upgrades, brand loyalty perks and travel discounts. Generally, they’re broken down into two categories, said Lidia Staron, a frequent traveler and card owner with OpenCashAdvance.com, a financial services website.

What is the best credit card for hotels?

As you search for the best hotel loyalty program, traveler card or best rewards club out there. You should do some research on the types of cards available to you — such as:

  • Co-branded. “Co-branded hotel cards are best suited for people who are loyal to a hotel chain and plan to earn and redeem rewards with the hotel's loyalty membership program,” Staron noted.  
  • General travel. “This card is used by most travelers, and will usually offer greater flexibility in earning and redeeming points,” she added.

Want to reap the benefits of your travels? Credible can help you compare travel credit card offerings from a variety of companies to assure you get the points and miles you're looking for.

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Consumers who use hotel or travel cards say the benefits outweigh any downsides.

“I am a frequent flyer because of my business and always use hotel credit cards,” said Sagar Sahay, founder of travel advisory website AlphaRagas.com. “Hotel credit cards mean extra benefits when I stay in the hotel. A hotel card can easily help a traveler earn free nights or better room on your next visit.”

How to pick the best one

Choosing the right credit card for hotel perks is all about laying the groundwork and shaping personal card usage goals.

“Job one is to look at your past spending to see which hotel credit card will offer you the most rewards,” said Steven Abrams, credit card expert at CreditCardsExplained.com and Offers.com. “For example, if your everyday spending is at supermarkets and restaurants, then look for a hotel card that earns bonus points in those categories.”

If you're just in it for the rewards and points, however, you should probably also research rewards credit cards. Credible can help you "maximize the value of your everyday purchases" by comparing credit cards with the best rewards programs for your needs.

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Abrams also advised being practical. “Try not to be aspirational, because you may get stuck with points that you will never use,” he said. “Pick a hotel brand card that you regularly stay at or that has hotels where you vacation.”

Staron also offered “quick tips” when choosing a card.

  • Think about which hotel chain you like most.
  • Evaluate the sign-up bonus.
  • Understand points value.
  • Do some redemption research.
  • Weigh the cost.

“Basically, hotel credit cards work best for people who are 100 percent certain they can use them,” Staron said. “If you’re sure about that, a hotel credit card is a good choice for you.”

Pros and cons

Deciding whether it's worth opening requires a closer look at the upsides and downsides.

Pros:

  • Upgrades on the spot. Sahay says he regularly uses hotel cards to upgrade his room status at check-in. “Even if you have a co-branded hotel credit card, you’ll still be given elite status,” he said.HOW TO QUALIFY FOR THE CREDIT CARD YOU WANT   
  • User racks up serious rewards points. Hotel card rewards points are easy to come by. Cardholders can use those points for unique perks like rental cars, dining and entertainment deals, extra hotel stay nights, and deals on co-branded hotel rooms around the world. “Cardholders can accumulate rewards points and then use them for unique and extravagant adventures that you possibly couldn’t afford otherwise,” said Zach Hewke, founder of the ZachHewke.com travel review website.
  • Elite status benefits. They can offer “elite qualifying nights” that give cardholders access to more options and deals. “That helps you achieve elite status in the hotel's loyalty program,” Staron noted. “For example, some of the higher tier hotel credit cards offer lucrative perks such as annual resort credits, airline credits, and even airport lounge access.”

Cons:

  • High annual fees. They usually come with high annual fees (up to $600 annually, according to Sahay). Worse, high annual fees aren’t usually waived during the first year a consumer owns the card.    
  • Limited award availability. While there are definitely exceptions, hotel points can be difficult to redeem. “That’s especially the case if you need to travel during peak travel times when award availability may be limited,” Staron said. “Using your hotel points can also be a struggle if you travel with children and need a room that sleeps more than two people.”  
  • Inflexible rules: Free hotel stays may come with still rules attached. Plus, annual resort credits may only be good for specific hotels, and they tend to be 'use it or lose it,' meaning your credit won’t roll over to the next year if you’re unable to stay at a specific hotel brand during a cardmember year,” Staron said.