Don't Give Up!

During my App-O-Rama, I applied for the Chase United Credit Card, among others.  I had previously gotten the sign up bonus for that card a couple years ago, but based on reports I had read on the internet I should not have trouble getting the bonus again.


I signed up for a 30,000 mile bonus.


Over the phone I confirmed with a rep that I would be getting the bonus.  Then I asked the rep about getting qualified for a 50,000 mile bonus with a $50 statement credit which I had already successfully gotten for my wife.


She said it wasn't her department, but Chase will contact me in 10 business days.


10 days later I got letter in the mail saying that I won't be getting any miles because I had previously gotten this bonus!  I was quite perturbed to say the least.




So, I sent a secure message to Chase without alluding to the letter I received.  Here is the message:

After I signed up for the United 30,000 mile sign up bonus 

I noticed that there was a 50,000 mile sign up bonus with  

a $50 statement credit. Can I please be matched to that  

offer? Thank you very much.

In a couple of days, I got the following message back from Chase:

Dear Oren, 

Thank you for contacting Chase regarding your United MileagePlus® credit card account. 

We are pleased to inform you that we have honored your request and issued a $50.00 statement credit and 20,000 additional miles. The credit and miles will be reflected on your next billing statement. 

If you have any further questions, please reply using the Secure Message Center. 
Thank you, 

Later that month, my $50 statement credit and miles posted to my United account and all was good in the world again.

Avoiding Annual Fees - App-O-Rama Part 4

Related Posts

Part 1 - App-O-Rama Intro

Part 2 - Picking The Right Cards

Part 3 - Credit Card Application Status

Part 5 - Affect on your credit score

Avoiding Annual Fees

App-O-Ramas create quite a dilemma.  The best sign up bonuses, in general, are for cards that have annual fees, which can really negate any savings you get if you pay them.  I have almost no credit cards with annual fees that I think are worth keeping the card despite the annual fee.

So, how can one get the bonus without paying the annual fee?  If there is an annual fee the first year of the card there is no way to avoid it.  Fortunately, most cards waive the annual fee the first year to entice you so our discussion will be limited to the annual fee of year 2.

Option 1 - Cancel Your Credit Card

The simplest, and least desirable, way of avoiding the annual fee is simply to cancel the card before the annual fee kicks in.

Drawback 

1. Canceling credit cards negatively affects your credit score because the average age of your credit cards is shorter if the card has been a long standing card and because your credit utilization will go up.  I hope to explain this in part 5 of the series.
2. You are also lowering your available credit if you every need it and you are losing leverage for the future, as I will explain in the second option.

Benefit

1. You can sign up again for the same card to get the bonus a second time.  Each credit card company has different rules regarding how long you have to wait between cards to get the new bonus so be aware of the fine print.

Option 3 - Consolidating Credit lines

I haven't tried it with other companies yet, but with Chase you can consolidate 2 credit lines into one.

For example, let's say you have a Chase Freedom with a $1,000 credit limit and a Chase United card with a $1,000 limit.  You can ask Chase, via secure message or telephone, to consolidate the credit line of your United card onto your Freedom card.  You will end up with a Chase Freedom that has a $2,000 credit limit and no United card.

Drawback

1. You get no extra miles or points as compared to option four.  
2. You also lose any benefits of that particular card because it's closed.
3. The more credit you have with one company the more risk the companies takes on.  If you have way more than you will every use (a different number for each person) consider asking the company to lower your credit limit after consolidation.

Benefits

• Using credit lines in the future as leverage
• If you have a Chase Freedom with a $10,000 limit and you apply for the Chase Sapphire Preferred and are rejected, you can usually call and ask to allocate credit from an existing credit line to get the new credit card approved.  In this example, you can ask for $5,000 to be transferred to Sapphire Preferred and you now have two credit cards with credit limits of $5,000.
• Your credit score is not affected
• You aren't really closing your credit history of this card, just transferring to a new card. Also, your utilization ratio stays the same. 

Option 3 - Downgrade to a card without an Annual fee

Some credit card companies will allow you to downgrade you current card to a different card that doesn't have an annual fee.  One example is downgrading a Chase Sapphire Preferred into a Chase Freedom.

Drawback

1. You also lose any benefits of that particular card because it is closed out.
2. If you don't already have the card with the annual fee, you may be losing an opportunity to get the sign up bonus for that card.

Benefits

• Using credit lines in the future as leverage
• Same as before
• Your credit score is not affected
• Same as before

Option 4 - Retention Bonus

This is my preferred option for a number of reasons.  You can call up the credit card company and say something like this, "I really like you card and your miles, but I am thinking about closing it becauseI don't want an annual fee and I don't feel like I'm earning enough miles."

Usually, but not always, they will then offer to waive the annual fee for a year or give you extra miles to stay on or offer a spending target (ie - 10,000 miles for spending $1,000 this month) to earn extra miles.

If they don't offer anything, you can ask for it.  "Can you please offer me a spending target to get extra miles?"

If they offer something, always ask if they can offer more.  They won't rescind the previous offer and you may be able to get a better offer.

Check out this post from The Points Traveler who is a former representative for Citibank, I found it very helpful in my own retention bonus calls. He suggests asking, "What are the most number of miles you can offer me to keep my business?"   They will have to tell you the highest offer.

Drawbacks

• You may have to call a few times to get the offer you want.

Advantages

• You keep all the advantages of your card because it is still open and often without an annual fee
• You get extra miles for free
• You can do it every year, theoretically.
• You can still do all the other options the next time if this doesn't work out.

Here is an example of one of my successful retention bonus calls.

Credit Card Application Status - Part 3

Related Posts

Part 1 - App-O-Rama Intro

Part 2 - Picking The Right Cards

Part 4 - Avoiding annual fees

Part 5 - Affect on your credit score


I finally applied this past week for my App-O-Rama and here are my results so far.

Chase United - 35,000 mile sign up bonus with authorized user.  I will try to get matched to 55,000 and $50 statement credit.

• Approved instantly!

Chase Ink Bold - Currently 50,000 points, but I hope to be matched to the 60,000 bonus offer.  

• Pending.  I called the Business reconsideration number (800-453-9719) to get a decision expedited and increase my chances for approval.  The agent told me I have to wait until I get a decision in the mail.  I will call again on Monday to see if I get a different answer.
• This is the only one I am concerned about at this point.

Citibank AA Mastercard -  40,000 miles.  

• Pending.  I moved recently.  Citibank wanted me to mail them proof of my address for security reasons.  Still waiting to hear from them.  I will probably call on Tuesday to make sure they got it if they don't call me on Monday. 
• I assume I will be approved once address verification is done.

Barclays US Airways - 40,000 miles.  I chose this over the NFL card because the NFL card bonus was expired.

• Approved after quick conversation.

PenFed American Express Travel Rewards  -  $200 sign up bonus towards my next round trip flight and 5% back on Airline purchases.

• Approved instantly.
• Another great feature:  This is an American Express card with no annual fee that is not through americanexpress.com  This means that I can get $25 free on Small Business Saturday.  American Express limits the number of credit cards you can have at one time to 4 (no limit on charge cards).  If the cards isn't issued by American Express, even though it is processed as an American Express card it doesn't count towards the limit.  Another examples is the Fidelity American Express.

Once these cards come, the spending can begin!

The Cards - App-O-Rama Part 2

Disclaimer: I receive a commission for the following link(s):  Barclays US Airways Card

Related Posts

Part 1 - App-O-Rama Intro

Part 3 - Credit Card Application Status
Part 4 - Avoiding annual fees

Part 5 - Affect on your credit score

Current Active Cards in My Name 

My wife (ie - singing up for her) has a bunch more, but that isn't relevant here.  Spouses are completely separate when it comes to credit cards and credit card bonuses.

Before any applications it's important to analyze the cards you have between yourself and your spouse to see if there are any glaring holes.  I haven't shown you all of our cards, but I can think of one.  Neither of us has a Chase Business card.  Chase business cards get you 5% cashback at office supply stores (staples, etc.), cable, phone and internet.  Therefore, this will definitely be one of the cards I apply for.

Once you have plugged every hole, you can start apply for cards based on sign up bonuses.

I use the following guidelines, but they are not set in stone:

• Every 6 months (see part 1), if they have a good bonus, I tend to apply for one card from each major credit card company: Chase, Amex and Citibank.  One business card and one personal card is ok too.
• I usually apply for one more card as well, but not necessarily.

New cards I will Apply For

Chase United - Currently 30,000, but I hope to be matched to the old 50,000 bonus offer.  We'll see how that goes

Chase Ink Bold - Currently 50,000, but I hope to be matched to the 60,000 bonus offer.  I chose the Ink Bold over the Ink Plus even though they have the same sign up offer because the Ink Bold is a charge card and Ink Plus is a credit card.  A charge card must be paid in full each month while you can carry a balance on a credit card.  This allows me to tell Chase when I apply to the credit card that I want this card because it allows me to carry a balance so that I can get both sign up bonuses.

Citibank AA Mastercard/Barclays US Airways - American Airlines and US Airways are set to merge this year and their miles will combine.  This is one of the last opportunites to double dip by getting both US airways and American airlines miles.

Barclays NFL - I can't decide between this one and the US Airways.  I am leaning toward the NFL because I like cold, hard cash.  Also, the US Airways card has an annual fee that isn't waived the first year.

PenFed - Penfed cards can be hard to get, but the rewards are good.  5% back on Airline purchases.

My Haul

If all goes right, here is what I can come away with:

• 115,000 Chase Ultimate Rewards Points.  
• Can be redeemed for $1,150
• 80,000 points is free round trip to Israel (I always measure in terms of trips to Israel because that is my ultimate plan on how to use most of these points).
• 80,000 American Airlines/US Airways points or 40,000 AA and the NFL card
• 90,000 AA points get you to Israel. 
• $400 from the NFL card
• $200 from Penfed

Spending Requirements

Assuming I go for the NFL card and not the US Airways card, I will need to spend $15,000 in 3 months.  This would basically be impossible without Vanilla Reload cards and Bluebird, but not terribly difficult with them.  Learn more about Bluebird and Vanilla Reloads here.

App-O-Rama - Part 1

Related Posts

Part 2 - Picking The Right Cards 
Part 3 - Application Status Update

Part 4 - Avoiding annual fees

Part 5 - Affect on your credit score

What is an App-O-Rama?

App-O-Rama is the Personal Finance term used when applying for many credit cards on the same day (App is short for application if you didn't figure that one out).  One can sign up for different credit cards and get lots of bonuses all at once.

I will have a paycheck for the first time in July so July will be the time to try an App-O-Rama.  I have been reading about them for the past couple of years so I have some good ideas on how I want to approach it, but this will be a learning process for me as well.

What's the point?

Organization.  It's easier to keep track of when annual fees kick in if you applied for a bunch of cards at the same time.

Practical.  You are more likely to be accepted for each card if you haven't had a lot of recent inquires for credit on your credit report.  If you applied for 3 cards in the last 3 months and you are applying for a new one this month that's risky behavior in their eyes.  If you are applying for 4 cards on one day, the inquiries from the other banks will all register in their system, but you don't have the recent history against you.

How many cards should I apply for?

That's up to you and there is no correct number.  The more you apply for the more sign up bonuses you get and the more money you need to spend to reach those spending thresholds.

It all depends on the level of risk you are willing to assume.  This may sound simple, but credit card companies are out to make money, not give you free miles.  This is a marathon, not a race.  You have the rest of your life to collect sign up bonuses.  If you are a non-profitable customer to the company, you run the risk of the credit card company closing their relationship with you, sometimes for many years and possibly forever.  You may do better in the short term but is it worth?  Up to you to decide.

Before you decide, take a look at this post on Fat Wallet about companies Blacklisting people for extreme behavior.  Some of the stories are really fantastic.

Some blogs advocate signing up for 3 or 4 credit cards from the same company on the same day so that you will only get one hard inquiry on your credit report.  This may be true for your credit report, but the credit card company still has its own records and knows what you have been doing to them.  Just because you can get away with it now doesn't mean you can get away with it the second, third or fifth time.

How frequently can you do it?

Same answer as before.  Whatever you are comfortable with.  Some blogs will advocate every 3 months.

I personally plan on starting with the every 6 months plan.  Every 3 months for me and every 3 months for my wife.  I don't travel so much so that should more than cover my miles needs and 2-3 cards a year per company doesn't seem too much to me, but who knows where life takes you.  Also, if one of you are applying every 3 months you are unlikely to miss out on any short term promotional sign up bonuses.

As I apply I hope to update how it goes and what I need to do to get all the cards approved.