topic Re: Chase 5 card rule in Credit Cards

Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 00:21:26 GMT

ive been a Chase banking customer for about 5 years. No credit cards, but that's sort of one of my goals. I'd like to be able to have one along with my checking and savings. But, that will have to wait till my scores grow a bit more. Anyway, I recently have seen talk of a 5 card rule. If you have 5 new cards in the past 24 months, they will decline your application for one of their cards. Well, part of rehabbing my credit was obtaining some starter cards. I have a Discover, Barclays rewards, Cap one QS, Buy Power, WM and Amazon store cards. All that said, if before I app for a Chase card, I was to close a few of these, would that satisfy their rule, or is it considered all cards open and closed?

Re: Chase 5 card rule

kdm31091 — Thu, 22 Oct 2015 00:25:18 GMT

Closing them will do no good -- the rule is 5 accounts opened in the past 2 years. Doesn't matter if they are still open. Unfortunately, all you can do is wait. Being a banking customer doesn't override the policy. The only card I have seen a few people get without regard to the policy is the Slate, but that's ostensibly because it offers no rewards.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 00:24:39 GMT

It's not having 5 cards in the past 24 months, it's opening 5 new cards in the pas 24 months. So no, closing cards wouldn't help if you applied for those 6 cards in the last 2 years.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 00:25:54 GMT

Probably not, however this appears to be an actual new question on the topic. New questions are rare!

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 00:29:24 GMT

@Anonymous wrote:
Probably not, however this appears to be an actual new question on the topic. New questions are rare!

What can I say, I'm a trendsetter

Re: Chase 5 card rule

ddemari — Thu, 22 Oct 2015 00:33:25 GMT

New questions are rare! u might be able to sneak in but then again who knows. U can get a co-branded card to go along nicely with your checking account lol.

Re: Chase 5 card rule

barthooper — Thu, 22 Oct 2015 00:53:40 GMT

@Anonymous wrote:
ive been a Chase banking customer for about 5 years. No credit cards, but that's sort of one of my goals. I'd like to be able to have one along with my checking and savings. But, that will have to wait till my scores grow a bit more. Anyway, I recently have seen talk of a 5 card rule. If you have 5 new cards in the past 24 months, they will decline your application for one of their cards. Well, part of rehabbing my credit was obtaining some starter cards. I have a Discover, Barclays rewards, Cap one QS, Buy Power, WM and Amazon store cards. All that said, if before I app for a Chase card, I was to close a few of these, would that satisfy their rule, or is it considered all cards open and closed?

I'd like to chime in and say that not too many people would think of most of those as "starter" cards. Some of them are prime cards with good rewards that can grow through CLIs over time. Even if Chase only cared about the open number of open accounts, it most likely isn't a good idea to close them for that purpose, as you seem to have wanted them at one point. If closed they'll factor into your Average Age of Accounts for the next ten years as well.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 01:18:39 GMT

I asked them that a few months ago and the credit analyst said that it would not only fail to help, but it would look even worse than not, as it looks more like churning if you close them. That was only what one guy said, but a data point for you!

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 01:34:00 GMT

@barthooper wrote:
@Anonymous wrote:
ive been a Chase banking customer for about 5 years. No credit cards, but that's sort of one of my goals. I'd like to be able to have one along with my checking and savings. But, that will have to wait till my scores grow a bit more. Anyway, I recently have seen talk of a 5 card rule. If you have 5 new cards in the past 24 months, they will decline your application for one of their cards. Well, part of rehabbing my credit was obtaining some starter cards. I have a Discover, Barclays rewards, Cap one QS, Buy Power, WM and Amazon store cards. All that said, if before I app for a Chase card, I was to close a few of these, would that satisfy their rule, or is it considered all cards open and closed?
I'd like to chime in and say that not too many people would think of most of those as "starter" cards. Some of them are prime cards with good rewards that can grow through CLIs over time. Even if Chase only cared about the open number of open accounts, it most likely isn't a good idea to close them for that purpose, as you seem to have wanted them at one point. If closed they'll factor into your Average Age of Accounts for the next ten years as well.

I was honestly shocked when I got the pre-approval letter from Discover. My FICO was around 620 at the time, TU was still showing 4 derogatories but 3 were about to drop off and the remaining is a medical that I'm about to PFD.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 02:07:17 GMT

I got the Freedom card about a week ago and Chase Amzon about 6 weeks prior to that. When approved for Freedom I had opened 11 new accts. in the past few months. I realize some accounts take forever to show on your report but Chase could see 6 + new accts. so I am wondering about this 5 card thing. I noticed Chase did a few soft pulls on my EX report Sept & early Oct. I got an 'offer' in the mail yesterday for Slate. I like them I guess but have no plans to get anymore of their cards at this point.

Re: Chase 5 card rule

Discover2016 — Thu, 22 Oct 2015 02:09:35 GMT

I have this gut feeling that Chase will relax or scrap the 5/24 rule eventually, especially with how competitive the market is.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 02:31:23 GMT

I called to recon an app today (sadly, did not suceed) and the guy I talked to on the phone said he had no idea about the 5/24 rule, had never heard of it before, and that I was the first person who had asked about it. He basically said that I was welcome to apply at any point in the future, near or far, after the new accounts I had showed consistent payments. Basically, I didn't get declined for too many new accounts, I got declined for not long enough history on said accounts.

HTH.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 03:53:30 GMT

@Anonymous wrote:
All that said, if before I app for a Chase card, I was to close a few of these, would that satisfy their rule, or is it considered all cards open and closed?

If you don't have the Discover it card, that is vastly superior to the Chase Freedom as they will double your cash back. I, too, learned to late that I should have applied for Chase Freedom before my other cash back credit cards, but that's what nubs do. They make mistakes. Anyhow, I wouldn't apply for the Chase Freedom unless they offerred a $200.00 sign up bonus which occurs twice per year. I, myself, still have 24 months until I can apply...just to complete my cash back credit collection, nothing more and nothing less, oh and also the Golden One Platinum with their 7% APR and 3% cash back for dining out purchases which my application was rejected because of too many new opened accounts.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 09:55:12 GMT

This rule wasn't applied to me. I'm not sure how legit it is because they did give me 3 chase cards in 30 days window, and I have way more than 5 cards within 24 months when I applied for their cards.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 10:10:05 GMT

i was instantely approved for the marriott card after i had opened 6 accounts about a year prior. this is the first time i'd heard of the 5/24 rule. i guess ymmv

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 10:13:27 GMT

@Anonymous wrote:
i was instantely approved for the marriott card after i had opened 6 accounts about a year prior. this is the first time i'd heard of the 5/24 rule. i guess ymmv

I dont think it applies to the partner cards like the Marriot etc. It's only the Chase specific cards.

Re: Chase 5 card rule

kdm31091 — Thu, 22 Oct 2015 10:41:21 GMT

@Discover2016 wrote:
I have this gut feeling that Chase will relax or scrap the 5/24 rule eventually, especially with how competitive the market is.

Let's just be honest here: the people Chase is trying to lock out with the 5/24 rule are not people who are keeping the cards long term. They want to lock out churners and bonus chasers. Competitive market or not, the people who collect the bonus and then SD/cancel the card are not profitable, nor are they customers I imagine Chase cares about keeping or satisfying as they aren't long term customers.

I think the rule is probably here to stay. Keep in mind that 5 in 2 years is really fairly reasonable for an "average" consumer. It seems crazy to people like us, but it really isn't.

Some other lenders are similar anyway. While US Bank and Barclay may not be as stringent about a certain number of accounts in 2 years, they both do not tend to approve people with a ton of inquiries and new accounts. The point is that for any lender, it can signal risk.

Re: Chase 5 card rule

txbusted — Thu, 22 Oct 2015 14:04:54 GMT

@Anonymous wrote:
I got the Freedom card about a week ago and Chase Amzon about 6 weeks prior to that. When approved for Freedom I had opened 11 new accts. in the past few months. I realize some accounts take forever to show on your report but Chase could see 6 + new accts. so I am wondering about this 5 card thing. I noticed Chase did a few soft pulls on my EX report Sept & early Oct. I got an 'offer' in the mail yesterday for Slate. I like them I guess but have no plans to get anymore of their cards at this point.

+1 I just got approved for a Freedom Card yesterday and it is my 6th card. To be fair it is only my 2nd non-starter card.

Re: Chase 5 card rule

Anonymous — Thu, 22 Oct 2015 14:44:47 GMT

@kdm31091 wrote:
@Discover2016 wrote:
I have this gut feeling that Chase will relax or scrap the 5/24 rule eventually, especially with how competitive the market is.
Let's just be honest here: the people Chase is trying to lock out with the 5/24 rule are not people who are keeping the cards long term. They want to lock out churners and bonus chasers. Competitive market or not, the people who collect the bonus and then SD/cancel the card are not profitable, nor are they customers I imagine Chase cares about keeping or satisfying as they aren't long term customers.

I think the rule is probably here to stay. Keep in mind that 5 in 2 years is really fairly reasonable for an "average" consumer. It seems crazy to people like us, but it really isn't.

Some other lenders are similar anyway. While US Bank and Barclay may not be as stringent about a certain number of accounts in 2 years, they both do not tend to approve people with a ton of inquiries and new accounts. The point is that for any lender, it can signal risk.

I'm reminded of the old joke about the retailer who lost money on every product he sold, but "made it up" in volume.

Issuers offer big signup bonuses because they know that most people are set in their use of just a few cards. Having one everyday card, one store card, and one airline card for free checked bags...then keeping those cards for several years or until circumstances change significantly...is about as complicated as most people get. This is the typical desirable consumer.

Issuers offer big bonuses to entice these consumers out of their established card choices. Issuers know that these customers, once won over, are likely to be very profitable. It is very rational for issuers to incentivize these customers with big bonuses.

But once an issuer can identify a customer as someone who is very likely to be unprofitable, there's just no incentive to offer that customer a new account and the associated bonus.

Chase is not so irrational as to be desperate for customers who it can see are likely to just take the bonus, not spend much after that, and then close the card to avoid an AF. Chase is interested in making money, not paying for our travel and getting little in return.

Although I've gotten three great bonuses from Chase in 2015 with many new accounts, it's also true that I've never closed an account and spend on CSP and Freedom regularly.

Re: Chase 5 card rule

kdm31091 — Thu, 22 Oct 2015 14:56:12 GMT

"Chase wants to make money, not pay for our travel and get little in return" basically sums it up 100 percent. I wish more people understood that, instead of thinking they should be entitled to get a signup bonus many times, and 5 retention offers of 20k points each, yet they never even use the cards.