Your Chances Of Being Denied For A Chase Card May Have Just Increased

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Credit card companies have been making changes lately to try and encourage profitable behavior and also cut down on the number of people applying for the same cards over and over. For example, American Express now restricts credit card bonuses to once in a lifetime, on both personal and business cards.

Last year Chase also instituted a new policy on their personal non co-brand credit cards (cards not issued in conjunction with another brand), like the Chase Sapphire Preferred® CardChase Freedom® Card, and Chase Freedom Unlimited. Specifically, Chase is generally no longer approving people for these cards if they’ve applied for more than five credit cards in the past 24 months. We’re not talking about five Chase cards in the past 24 months, but rather five cards of any kind.

The logic is likely that they assume those with more credit cards are more likely to be getting the cards just for the sign-up bonuses, and therefore are less likely to be profitable customers.

In March I wrote about how Chase was apparently planning on extending this policy to their co-branded credit cards soon. That was per Doctor of Credit, who was quoting an unnamed source.

Now Doctor of Credit is reporting that as of a couple of days ago, Chase’s policy of not approving those who have applied for more than five cards in the past 24 months has been extended to several more cards. The policy of not approving people who have applied for more than five cards in 24 months is nicknamed the “5/24 rule,” so it’s sort of funny that he wrote about it yesterday… which was May 24 (5/24).

Per Doctor of Credit, this 5/24 rule now applies to the following cards:

  • Chase Business Ink Plus/Cash
  • All Chase Marriott Cards
  • All Chase Southwest Cards
  • All Chase United Cards

Supposedly this doesn’t apply to the following cards:

  • Chase IHG
  • Chase Hyatt
  • Chase British Airways
  • Chase Disney
  • Chase Fairmont
  • Chase Amazon
  • Chase AARP

The fact that different co-brand cards have different policies seems a bit strange, so I wonder what determines the differing policies. Interestingly Doctor of Credit points out that the cards to which the new rules apply are all ones where there’s both a business and personal version of the card. That’s not the case for the cards to which the new rules supposedly don’t apply.

I wouldn’t take this information so far as absolute fact (not doubting Doctor of Credit, but rather sometimes this isn’t implemented consistently). But I do think it’s at least being aware of what the new rules supposedly are, so that we can share data points based on our experiences going forward.

Bottom line

We knew the 5/24 rule was being extended to more Chase cards, so this doesn’t come as a surprise. I suppose the good news is that this doesn’t apply to all Chase cards, including the IHG® Rewards Club Select Credit Card and British Airways Visa Signature® Card, which are two of Chase’s better co-brand cards. I’d be very curious about what’s going on behind the scenes to determine whether a card has this restriction placed on it or not.

Have you applied for any Chase cards in the past few days, and if so, what was your experience like?

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Comments

  1. Does this rule also count in cards that one is an authorized user for or is the mark only on the main card holder?

  2. That’s too bad… the 100k Marriott Business card was on my radar but I’ve reached the 5/24 rule.

    Lucky, on a different question about Chase..

    Do you think I should call Chase and lower some of my credit lines to increase my chance of automatic approval? Because now everytime I apply for a Chase card, I have to call and move my credit line around to get approved because I have reached the max $$ Chase wants to loan out to me.

  3. @Nik- it sure does. Am currently fighting this because I haven’t opened any cards, just been AU. Chase rep told me I shouldn’t have opened so many “joint accounts” (his words, not mine).

    Chase is actually just planning to stop issuing credit cards to new applicants (it seems).

  4. Likely has to do with contracts with the co-brand party – could be expanded as those contracts are renewed/re-negotiated. Chase can do whatever they want with their own cards, but in the co-brand space you have another party involved. That co-brand party also shares in the profitability of the product so it is less of a direct hit to Chase.

  5. Excellent news. if people stop churning cards maybe the card companiedls can lower late fees with all the $ they save in commission to affiliates.

    That being said I wish card companied would be required to disclose on the application form online who is getting paid and what commision account. I often have many browser windows open,who knows whst for internet cookies, etc. We know blogs like this, plus google searches etc each get paid like $500 per signup, right? I’d hate to think that finishing signup via the wrong link wrong browser etc was benefiting someone I didn’t want to help.. (an airline, etc!)

    Heck if someone wanted to write a piece of malware I could probably do so, to sit and wait for known affilite links to be clicked and redirect it to their own ‘identical’ signup offer.

  6. Don’t you have a relationship with Chase? Why can’t you confirm and find out for us?

  7. It’s time to take a break. Concentrate on career, family and that hottie in shipping. Come back in 2 years and do it again. Everyone needs to find their story in this.

  8. I wonder if this helps or hurts Chase in the end. I think there are a lot of people who read this blog who come out way ahead and never become profitable to Chase. I think there are also a lot of people here who spend huge amounts of money on personal and business travel and who could also become Chase’s best customers whether through credit cards, brokerage accounts or mortgages. These people are savy and still want to save money on flights and hotels, even if they can afford full price. I suspect in the future, you will see Chase soften this rule so they don’t lose the latter group.

  9. My wife was recently denied for a new Freedom Unlimited card. She has applied for 2 new cards in the past 24 months, but has been listed as an authorized user on 3 more.

  10. Yup, I can confirm that Chase stopped giving sign-up bonus for Marriott co-branded card. I had previously gotten the Chase Hyatt card (probably close to 2 years ago), and when I applied for the 80,000 bonus card for Marriott, I was just informed that I was not eligible. So I will be closing out that card, bummer!

  11. Does anyone know if the 5/24 rule concerns cards “applied for” or “approved”? For example, I was denied a Chase card last fall because I was over the 5/24 limit, and now I don’t know whether to count that denial when I’m figuring out when I’m eligible again.

  12. They cited 5/24 rule when I applied for Marriott card months ago so it’s always been in their back pocket if they don’t want to approve you.

  13. I had chase deny me for the chase sapphire card claiming I opened too many accounts in the past 24 months. But then I pointed out that some of the accounts opened were me being an authorized user on someone else’s card and that shouldn’t be held against me. He put me on hold for a bit, then came back after further reviewing my history and was like “Yeah you are right, it shouldn’t be held against you”. He then approved me on the spot. I would call back and speak to another rep for further review if this happens to you.

  14. I’m certainly over the 5/24 but received a pre-approved offer for the United card in the mail last week. Seems like they still want me to apply even if I’m over

  15. I closed my Chase United card but someone didn’t get the memo. I still get balance transfer checks and even got a new set of club passes lol.

  16. @Victor – Unfortunately targeted mailers don’t seem the help at this point.

    @David – Chase counts new credit cards, not “applied for” cards or inquiries.

  17. I was just denied for IHG card. Never denied before for a card. They said too many new accounts. That was May 23rd, 2016

  18. I got denied for the Chase Southwest Airline card due to the 5/24 rule on May 23rd, 2016

  19. @BOSflyer, that had nothing to do with 5/24. They would not have given you the card at all. Most likely, it was just a mistake. We got a postcard that said that my wife was not eligible for the BA bonus that she had already received and was fully eligible for as neither of us have ever had one (in fact, she didn’t even have an Avios account prior to applying). I SM’d them and they advised that it was a mistake and confirmed the details of the offer she was eligible for as the one she has applied for. I would cancel the card if I were you, until you have an explanation why you aren’t eligible.

  20. @Farnorthtrader thanks for this info, and I will make sure to double check. Maybe I am getting the bonus points, and they just haven’t been put in my account yet. I only recently received the card, and I think you had to spend $3K over 3 months to get the bonus.

  21. I was denied by Chase 5/20/16, I called them for review and they first insisted on “two many accounts open with us.” When I argued that point the rep came back with the 5/24 rule. My first rejection ever- ouch, it stings!!! My knee jerk response was to cancel all my Chase accounts, but I eventually calmed down lol.

  22. I can confirm that the 5/25 rule DOES NOT APPLY for the Chase IHG card. I was approved today, May 25th. I have now opened 10 credit cards alone within the past year (6 personal & 4 business).

    I received a letter in the mail from the Chase Fraud Department, as they wanted to confirm that I applied for the card. I called them, confirmed my identity, and then they processed the application and I was approved!

  23. @Juno–Just got approved yesterday for Freedom Unlimited after calling Chase credit dept. every two or three days during the past two weeks and spending hours on the phone. It was my 5th card in the last 21 months (6th card in the last 27 months). Chase told me they would approve the application immediately if I would reallocate credit, but I held out for not reallocating. Finally received what I asked for (and everyone from Chase was very nice), but they said they are definitely looking at total exposure. Currently have four cards with Chase, so Freedom Unlimited makes five.

  24. Recently my wife was denied for the CSP due to having to many credit cards. She has only three cards of her own but is an AU on several others. She called the reconsidered line and explained her situation as being an AU on multiple cards of mine. The representative reevaluated her application and approved her instantly and sent out the cards priority mail. Hooray for Chase.

  25. Happened to us this week. Wife applied…$100k+ incoe, 780 credit…Denied.

    I would have to say this is not good for your relationship with Chase, Ben. Nor is it good for your members…My wife spent 30 minutes on the ap…wasted

    Bad for Chase,too. We always said we would never do business with them, a window opened, now we are closing them off forever. We spend over $25K a month on credit cards.

  26. I applied for the Chase Sapphire this morning and got the “review your application” message. I called this evening and was told that I was denied because I had too many accounts and didn’t have enough “history” for them to approve me for the card. I also told them that I had cancelled cards that I didn’t feel were benefiting me so I didn’t have more credit out there than I could handle. I have excellent credit, pay off my cards every month, my score is 840 plus. They are crazy!

  27. Does anyone know if getting a government credit cards counts towards the 5/24 rule? I’ve opened 4 credit cards in the past 24 months on my own, but when I started my new job (which involves a lot of travel), I had to open a GSA Mastercard to pay for the travel – this was before I got into the points/miles game, but I do recall them saying the card would affect my personal credit (as in if I paid it late, etc.), but not sure if it would count towards the 5/24 rule or not since it’s a work card.

    Thanks!

  28. I waited the 24 months to churn the Marriott 80,000 points deal. I was denied due to the 5/24 rule. I have Platinum status with Marriott. I just wrote a letter to Marriott explaining that the denial is a very negative impact on my Marriott experience. Marriott wants their Platinum members to feel like Kings. Kings don’t get denied for credit cards. I also hinted I’d be switching loyalty to SPG. Marriott needs to know their relationship with Chase will cost them Elite Business Travelers Chase. The way to put pressure on Chase to change their ways is to complain about 5/24 to the Sponsoring Company.

    I also canceled every Chase Card my family uses. We stayed at the Kauai St. Regis on SPG points & it was wonderful. Looks like I’m an SPG guy now! I just applied for SPG cards for everyone in the family!

  29. Denied for IHG card today (8/17). Received 80k offer. Do not have five cards, much less “5/24” rule.
    I presume it’s still too much credit outstanding.

  30. Never been denied before. Was denied the chase reserve due to too many accounts. Bummer cause I just signed up for Hilton and IHG would have rather had chase reserve.

  31. Can confirm. Was just denied a United card with a 780 credit score for having opened too many cards in the last 2 years. I have opened exactly 5.

  32. I absolutely hate Chase! I have five accounts with them and have had nothing but problems. I have excellent credit and was turned down for the explorer card and freedom. Now I know why…thanks for the info. I will be closing all of my accounts with Chase and going elsewhere. It’s a pain in the neck to do so because of all the bill pay and automatic payments but I really don’t like them AT ALL. I’m sure they could care less about my few accounts as I’m not a member of the 1% club but I’m still going to do it out of pure principal.

  33. They send me emails to apply for the Soutwest card, which I want and then I get denied. Even for the Chase Disney card. The letters say too many cards closed in the past 2 years, which is 100% true. I guess my days of flying for free and companion passes are over. BTW…my credit score is 832.

  34. I applied for personal Southwest and business Southwest and was approved for one and not the other. Got the letter that said I have too many requests for credit or opened accounts with Chase. Spoke to a rep and they said that Chase considers two applications in one day too many and that the account was coded “approve one-deny all” and I had to wait 30-days to re-apply for the other card. Said they could not override that code. Anyone hear of this or had it happen?

  35. I was turned down for Chase Business Premier Southwest Airlines Card 2 months ago.  I have opened two credit cards in the past 2 years so the 5/24 rule isn’t what got me.  When I called the reconsideration line the specialist I spoke with seemed most alarmed that I had recently transferred a balance to my Chase Freedom Card.  They had a 2% balance transfer fee so I moved about 14K and I have 17.5K limit.  So I was >80% utilized w/ Chase.  My overall Credit Utilization is 30%.

    Now I’m in a situation where the SWA card is very important to me.  I need to get it in my name and run my employer’s expenses through it 50+K/yr.  My employer gross income is substantial compared to the CC limits we’ll need, but I know the Chase application looks at the credit score, DTI, credit utilization etc of the primary card holder.  I need the miles to commute.  In January 2017 I will be able to pay the Chase Freedom Card down by 7K if necessary.

    My question:  I very much need the SWA card, I want to pay down the Chase Freedom as much as necessary to get the Chase SWA card.  Anyone know how much I should pay down the Chase Freedom so as to get approved but pay down no more than necessary?  (other info: overall CC balances about 15% of annual income, credit score 760) 

  36. Understand the purpose, but it’s a little self-defeating to reject applications on this basis only. I typically spend $20-30k on purchases before cancelling the card (to avoid the annual fee) and assuming they get some 3% of purchases, that’s $600-900 they don’t get. They could just reject the bonus and still provide a card, that’s what I’ve seen from the Delta American Express and American Airways Mastercard when I re-apply too quickly. I like having a United card for travel as it provides free baggage.

    By the way “Tim,” late fees are optional. I’ve had dozens of credit cards over the past 15 years and only twice, I believe, did I miss payment and pay a late fee. Set up automatic payment or a system to remember to pay, your option.

  37. I was given a Chase Card with united miles in January of this year. I have never been late and most of the time I paid off the charges each month. Over the 6 months I charged approximately $5,000 on the card and paid it off during that time. I requested the Southwest credit card and was denied mostly due to delinquency or the derogatory relationship with Chase. I did negotiate to pay a portion of a credit card at that time (a retired lady in her 80s) and they are still holding it against me. This was in 2009. Also, I had a short sale with Chase in 2007 due to the economic decline of real estate in which I lost approximately $70,000. I would like to know if Chase ever closes the file on prior derogatory items. I also question why I was given the card in January and not the one I just applied for.

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