Honest question on AF's

[Anonymous]

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@Chris679 wrote:
I bet CCC hate it when I ring up 0% APR charges for 12-15 months and then pay them all off befor the intro period is up does that mean that's not ok either? That is basically the logic you are using. If it does not make them money=they don't like it=it's not ok. You are overlooking the fact that customers who do this stuff are safe borrowers for them. As long as they limit the bonuses they will come out ahead because a certain % will end up with a balance. Like I said they know what they are doing.

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Right.  And also we are not dealing with natural law here, the whole bonus for min spend thing is something completely in control of the issuers.   It would be simple for them to split the bonus into two periods, one after the annual fee (as TY Premier does) or not to give them at all.    Since some continue to do so, they presumably find that it works out OK for them (enough people are attracted by the bonus and stay to make it worth while)

And both sides can terminate the relationship if they are getting too little from the deal.

[Anonymous]

As much as I love reaping rewards (and you can see from the cards I have and the cards I have on my wish list in my sig that I love reaping rewards quite a lot), I personally have made the choice not to churn. I know doing it once or twice is probably not going to raise any eyebrows, but I can't imagine Chase, for example, would be too happy with me if I made a repeat habit of it, and I find it likely I would probably be put on an internal blacklist if they suspected I was trying to exploit them. If Chase was nice enough to extend credit to me, I'm not going to burn that bridge by annoying them with sign up bonus abuse. I'm not one who poops where I sleep.

That's not to judge anyone else who does. It's just not my style.

As for annual fees, I try to include them in my assessment of rewards on a card, as mentioned by an earlier poster. The only card with an AF that I have my immediate sights set on is the Marriott Premier Rewards Visa because the free annual stay covers the price of the annual fee (and then some). Most cards that have annual fees I would not earn enough rewards on to justify getting them, hence why they are not on my radar.

[red259]

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@Chris679 wrote:
I bet CCC hate it when I ring up 0% APR charges for 12-15 months and then pay them all off befor the intro period is up does that mean that's not ok either? That is basically the logic you are using. If it does not make them money=they don't like it=it's not ok. You are overlooking the fact that customers who do this stuff are safe borrowers for them. As long as they limit the bonuses they will come out ahead because a certain % will end up with a balance. Like I said they know what they are doing.

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+1 They have already done the math and don't need consumers to look out for them. You better believe they come out ahead over the customers. If lenders have a problem with what someone is doing its a simple thing to shut them down. Its not like they can't see what people are doing!

[Anonymous]

For every churner out there, there is some sucker who signed up for the bonus, and doesnt cancel a card that doesnt reward his particular spending pattern well at all and pays not only interest but 5 AFs. I wont churn, my income doesnt allow it, but until Amex Chase citi and the rest go broke from sign up/pif customers I don't begrudge anybody who does. MS is a bit different to me, only because I see those people whine when CVS stops taking credit cards for their one vanilla purchases. You dont get to whine when you are buying what is obviously cash equivalents and somebody catches on 

[Chris679]

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@Anonymous wrote:

As much as I love reaping rewards (and you can see from the cards I have and the cards I have on my wish list in my sig that I love reaping rewards quite a lot), I personally have made the choice not to churn. I know doing it once or twice is probably not going to raise any eyebrows, but I can't imagine Chase, for example, would be too happy with me if I made a repeat habit of it, and I find it likely I would probably be put on an internal blacklist if they suspected I was trying to exploit them. If Chase was nice enough to extend credit to me, I'm not going to burn that bridge by annoying them with sign up bonus abuse. I'm not one who poops where I sleep.

That's not to judge anyone else who does. It's just not my style.

As for annual fees, I try to include them in my assessment of rewards on a card, as mentioned by an earlier poster. The only card with an AF that I have my immediate sights set on is the Marriott Premier Rewards Visa because the free annual stay covers the price of the annual fee (and then some). Most cards that have annual fees I would not earn enough rewards on to justify getting them, hence why they are not on my radar.

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So now they have a mysterious internal blacklist?  Where are you guys coming up with this stuff?  Some of you guys seem like you look at these companies as if they are a wounded puppy that needs care and nurturing.  The reality is that they are a pack of wolves feasting on 40% of the population.  Those of us here are just collecting some table scraps for ourselves.  They tolerate us because it's in their best interest to do so.

[Anonymous]

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@kdm31091 wrote:
But churning for bonuses is arguably NOT the kind of responsible card handling the issuer is looking for

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Many issuers have rules regarding eligibility for bonuses in their T&Cs. Most issuers tend to freeze or close accounts due to suspicious spending and the likes. If an issuer wants to limit churning, they could simply make the bonus a once in a lifetime bonus instead of a 12-24 month lockout that many seem to have.

Anyway, there is no right answer here. There is nothing wrong with churning or not churning cards. But you don't have to churn cards to have an AF card for a year. Getting a CSP for 1 year and canceling it is not churning. An example of churning would be grabbing the CSP, getting the bonus, closing the CSP, waiting out the lockout, getting a new CSP, and getting the new bonus (CSP is just an example...I keep my CSP active all the time because I put most of my restaurant/travel spend on it).

[kdm31091]

Nobody's arguing that the banks need to be nurtured or anything. However, some look at it as: they are the ones extending you the credit. They're the ones providing the rewards and bonuses. If you take unfair advantage of bonuses/rewards, of course they are going to shut you down, or not let you back in with them later. It would sure suck to be shut out of a good lender permanently, or just to have an account closed by them -- embarassing.

Anyway, this also leads to benefits being taken away for everybody, but that's another topic. Bottom line is some people don't want to bite the hand that feeds them the credit line and the rewards and the bonus, and that's fine too. Do what you want, but as you said: they tolerate it. It does not in any, way shape or form mean that they condone it. Whether it's "right" or "wrong" is debateable ,but those who choose not to do it are not trying to nurture the banks, they are just trying to be wise with the money that has been lended to them. Churning for bonuses is basically just taking advantage of free money, which is fine, but the lender intends for you to keep the card obviously, the bonus is meant to draw you in, not be "hey it's 400 free dollars and then I can cancel!"

Getting the CSP and cancelling after a year is not technically churning, no, I'm referring to the more high velocity stuff. I still think it's silly to get a card knowing you aren't going to keep it, but YMMV

[Anonymous]

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@kdm31091 wrote:

Nobody's arguing that the banks need to be nurtured or anything. However, some look at it as: they are the ones extending you the credit. They're the ones providing the rewards and bonuses. If you take unfair advantage of bonuses/rewards, of course they are going to shut you down, or not let you back in with them later. It would sure suck to be shut out of a good lender permanently, or just to have an account closed by them -- embarassing.

Anyway, this also leads to benefits being taken away for everybody, but that's another topic. Bottom line is some people don't want to bite the hand that feeds them the credit line and the rewards and the bonus, and that's fine too. Do what you want, but as you said: they tolerate it. It does not in any, way shape or form mean that they condone it. Whether it's "right" or "wrong" is debateable ,but those who choose not to do it are not trying to nurture the banks, they are just trying to be wise with the money that has been lended to them. Churning for bonuses is basically just taking advantage of free money, which is fine, but the lender intends for you to keep the card obviously, the bonus is meant to draw you in, not be "hey it's 400 free dollars and then I can cancel!"

Getting the CSP and cancelling after a year is not technically churning, no, I'm referring to the more high velocity stuff. I still think it's silly to get a card knowing you aren't going to keep it, but YMMV

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This is your opinion.

[kdm31091]

Of course it's my opinion, just like it's others opinion that it's a great idea to churn for bonuses, haha to each their own Generally, not always, issuers nerf benefits if they aren't profitable. If people are MSing or cheating or churning, it's not profitable, thus the benefit gets nerfed (in my opinion). Again, sometimes that's not the reason.

[Anonymous]

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@kdm31091 wrote:

Of course it's my opinion, just like it's others opinion that it's a great idea to churn for bonuses, haha to each their own

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Capital Idea!