Chase Freedom Card Denied; New Chase Rules

Last Thursday, I applied for Chase Freedom card with 20,000 bonus UR points and Citi Thank you Premier card with 50,000 points bonus.  The Chase Freedom application was in pending state. The Citi Thank you Premier card was approved immediately.  Five days later, I called Chase reconsideration phone number at 888-245-0625 and learned that my application was already denied!

I talked courteously to the Chase specialist trying to confirm if the new Chase card application rules is true.  Unfortunately it is.  I probably asked the specialist essentially the same questions yet worded differently several times.  And he courteously provided a similar response.

"In the last 24 months, you have opened up total new accounts that has an increase of $47,000 new credit.  We like to see stability of credits."  

He did not mention that I have had more than 5 new credit cards within the last 24 months.  Now is June and this year I have applied only two new credit cards which are both non-Chase credit cards.  My feeling was mixed.  On one hand, that means I have to wait 24 months before applying and be approved for Chase Freedom card again.  On the other hand, it confirms my "forecast" that credit card sign-up bonuses will become much harder to be qualified.  Just imagine if Citi and AMEX follows the same Chase rules.  Earlier this year, I have decided to do better on my own job to secure a pay raise, which is more reliable and predictable, than thinking and working on credit card sign-up bonuses all the time, thus only 2 credit cards this year. :-)


What to Do Next

Due to the new Chase credit card rules and anticipation of stricter rules from Citi in the future, my credit card application strategy plan changes slightly.

• Apply maximum 5 credit cards (Chase or non-Chase) with only excellent sign-up bonuses per 24-months. I personally target only 3.
• Keep total credit increase no more than $20k during every 24 months period.  In other words, if a new card has been approved.  Call/write to Chase customer support to lower the credit after card received, and/or cancel another credit card which is no longer in-use, sign-up bonus received, and not more than 1 year old.
• Keep a Chase Sapphire Preferred or Chase Ink Card active, even if it means paying the annual card fee, so to be able to transfer UR points to Chase travel partners.  Without either of these two Chase cards, UR points can only be redeemed for statement credit at best.
• Instead of canceling annual-fee credit card, consider downgrade to a no-fee version card, to keep good credit history.  Downgrade does not generate account creation in our credit report.

With American Express limiting one approval for its AMEX consumer credit cards (except via referral), and now Chase wisely reviewing card applicant credit profiles, folks will be flocking to apply Citi credit cards.  Citi has been trying to win more consumer card business.  Now it has the opportunity.  However, once it sees too much card churning, Citi will add some new rules.  Citi has already recently added.

Bonus ThankYou points are not available if you have had a Citi ThankYou Premier card opened or closed in the past 18 months.

That pretty much means at least a 24-month period, because of a new card should be opened for at least 6 months before it would be cancelled without losing sign-up bonus points.

For myself, it is more practical to increase vacation currency by focus more in my job, receive a raise, and able to spend more using credit cards with attractive bonus categories.  I still plan to accumulate sign-up bonuses to redeem luxury travel flight tickets or hotel nights.  We will pay for economy flight tickets using Citi Thank you Premier card or American Express Premier Gold card for 3x points.  There are also ways to earn bonus miles or points via non-credit card channels such as Fidelity 50,000 UA or AA miles, which we will continue to utilize. (Pisa 1st, 2nd, 3rd.)