Be Careful About Credit Card Eligibility

As you’re probably aware if you’re reading this blog (among others in the points and miles area), you always need more points. The best way to earn more credit card (or airline or hotel) points is by signing up for new credit cards. Yes, you can earn a decent number of points from category bonuses like dining, grocery, gas, etc. and from referring friends and family to open up new cards, but ultimately, sign-up bonuses are where the bulk of points will be earned.

Every card issuer has quirky rules about how and when you can apply for a card and when you can receive a sign-up bonus. Here are some of the most common rules that you need to be aware of if you are planning to sign up for a new card with the largest banks.

American Express:

Amex has a once per lifetime rule on sign-up bonuses for each card. This means you can earn a sign-up bonus for cards like the personal and business versions of the Amex Platinum and Amex Gold plus each of the co-brand personal and business cards (Delta, Marriott, Hilton). However, there is a huge caveat to this: No Lifetime Language (NLL). If you receive an email or a mailer without this limiting language, you may get approved for multiple of the same card. This is more likely with business cards, particularly the Platinum or Gold.

One of the best things about Amex is that it will check your eligibility for a sign-up bonus BEFORE they process the application and you will get a pop-up message indicating you are not eligible so you can cancel your application. This is something that other card issuers should have as it’s very helpful.

Amex has a five credit card limit and ten charge card limit per accountholder. This includes business and personal cards. Charge cards include Amex Platinum, Gold and Green personal and business cards. These cards do not have a set credit limit and must be paid off every month (which you should always be doing with all credit cards anyway). Amex generally also limits new card applications to two per 90 days although there are some reports that this can be bypassed.

Capital One:

Capital One limits you to two personal cards at one time, so if you have a Venture X and a SavorOne (like I do), you can’t apply for another Capital One personal card unless you cancel one of the other cards. Capital One also limits approvals (for business or personal cards) to one every six months. They are also known to be quirky about approving people, even with good credit, for any cards. It may help if you have a banking relationship with them as my wife and I have had no problems getting approved for Capital One cards and we have had a bank account with them for many years.

Chase:

Probably the most infamous rule of all is the 5/24 Rule. If you have opened five or more personal credit cards with any card issuer over the past 24 months, you will likely be denied for most Chase-issued credit cards with little to no chance of reconsideration. This has been loosened lately with a few reports of people being approved for Chase cards even when not 5/24 compliant, but I would not plan on getting approved if you are over 5/24. Remember that business cards generally don’t count against 5/24.

Chase also has restrictions on sign-up bonuses, including their most popular Ultimate Rewards earning cards, the Sapphire Reserve and Sapphire Preferred. If you have received a sign-up bonus on one of these cards, you cannot earn another one until 48 months have passed from receiving the bonus. Before you apply again, you will have to downgrade to a no-fee Freedom card as you cannot hold two Sapphire cards at one time. Chase also has specific restrictions for Southwest cards (24 months between bonuses) and Marriott cards (a very complicated matrix that involves business and personal cards and American Express Marriott cards as well).

Citi:

Citi has a few rules to be aware of including that you can only apply for one card (personal or business) every eight days and no more than two cards in a 65-day window. You can also only apply for one business card every 90 days. In addition, Citi has a rule about sign-up bonuses where you can only earn one every 48 months for each individual card, including co-branded cards like American Airlines.

I hope this was a helpful primer for anyone looking for new credit cards. Other card issuers such as Barclays, Bank of America and Wells Fargo also have various restrictions, but I wanted to focus on the major transferrable currency card issuers as those are the ones you should focus your attention on especially if you are fairly new to credit card points and miles.

If you enjoyed this post (or have questions), let me know in the comments or send me an email at emptynestermiles@gmail.com. If you are thinking about opening a new credit card, please use one of my links.

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