@ToxikPH wrote:I'm thinking of re-opening a Chase checking and opening a YouInvest account to build up a relationship in order to be better suited for an approval once I'm under 5/24. Is a relationship important at all for their cards or am I fine without opening the accounts?
Thanks for the topic, @ToxikPH. This is always a popular and sometimes divisive one, but good to discuss.
I think saying either "yes" or "no" to whether relationship matters to Chase or any other bank is an oversimplication in most cases. It also depends on your objectives and HOW you expect your relationship with the bank to be beneficial. The great majority of lenders want to do business with you beyond just opening a credit card and may factor your overall relationship into the opportunities they offer you. Some are more open and vocal about it than others, such as with Navy Federal's internal "relationship score" you get to see if you're denied a NFCU product. Who is to say that other lenders don't also use such algorithms in their approval processes? Even if lenders don't use an objectively-scored number, they may use subjective relationship criterion in manual reviews.
And yes, there are members on My Fico who have used the strategy of opening accounts prior to applying for credit cards to get prequalified offers, to increase their odds of approval, or just to try to increase the approval terms such as starting limits. Sometimes, having significant deposits with a bank for awhile or moderate-to-heavy banking activity appears to help with higher relative starting limits or credit limit increases. From my observations and remarks from others on the forums, this technique does seem to often help "grease the skids" before applying for cards in lieu of simply cold-apping. One of our members who has seemed to master this technique is @Mahraja but there are others as well.
But back to your basic question: If I'm under 5/24 and I want a Chase credit card, do I need to open banking accounts to get approved for a new card? The answer is no. I have never had a Chase checking account, savings account, investments, mortgage or auto loan. I've been a Chase credit-card (only) customer for 20 years. I currently have six open Chase credit cards with total credit lines of $138.4K. They are by-far my largest single lender and I don't have $1 in any accounts with them. They apparently like my single long-time card history combined with my high credit scores and high income. Still, I believe relationship matters to some degree, even with Chase.
Chase is the largest bank in the US with more than $3 TRILLION in assets. So of course it's going to take more to "impress" them than some other banks! A smaller regional bank in a small community may fall over themselves tending to a client with only $100K invested versus the $10 Million figures quoted earlier. It's all relative. But I believe that saying a banking relationship with them is either $10 Million or nothing is an overstatement.
For credit unions, one typically has to join by opening a "share savings" account with a minimal deposit. For other financial instituions, someone with a good or better credit score, good income, reasonable debts, and an acceptably-low ratio of new inquiries or accounts can usually get approved for the the majority of credit cards without having to open deposit accounts. There are a few exceptions, such as someone without any type of US Bank relationship trying to apply for an Altitude Reserve card, which is specifically advertised for bank customers. Or maybe the Bank of America's Premium Rewards card, which data points have shown that odds of approval are low without at least a checking account; cold apps are often denied. Or HSBC's enrollment in their Premier Program to qualify for the Premier World Elite Mastercard. But generally speaking, you rarely HAVE to have banking relationships to be approved for most cards. And this is the point that many have made above, with which I agree.
On the other hand, the $10 Million clients with Chase Private Bank are the ones in the highest tier of personal service with Chase and the ones who undoubtedly have the "best" or most customized service. They're in a league of their own. Yes, these are the ones who qualify for the invitation-only JP Morgan Reserve card (previously the Palladium card.) But that's not what you're asking about, so bringing up the $10 Million deposits seems a little off-topic IMO. The problem is that this is the best quantified data point about Chase card approvals, but does that mean that smaller relationships mean absolutely nothing? I beg to differ.
There are also the customers with at least $250K invested, who qualify for the much-lower "Chase Private Client" program. While they bring less to the party, and don't warrant the high levels of personal service, there's a LOT more people who qualify for this level. Even though they are more common comparatively-speaking, they are still a pretty exceptional group in terms of overall US Population wealth. (Statistically, the median household net worth in 2010 was only $68K. These are all families who are probably in the top 25% or higher.) No more than forty of them together may make up the wealth of one Private Bank client. They add up. You can believe Chase doesn't want to drive them away in droves, and is willing to spend at least some energy grooming them. That's just smart business.
I have found that once you have some type of product ("relationship") with a lender, it often does lead to offers to "deepen the relationship." So if your objective with a lender is more than one single credit card or great SUBs, the relationship may matter more. For example, I don't bank with Wells Fargo but I was added to my two daughter's checking accounts when we set up accounts for them near their colleges. I also had two co-branded cards from WF a few years ago which I have since closed. They recently sent me an unsolicited preapproval for the Cash Wise card with a SUB, which I just completed. They approved me regardless of a very high number of other new accounts. I have gotten targeted offers from Bank of America and now from Chase to open checking accounts with higher than off-the-street SUBs. I'm planning to take up Chase to open checking and savings for the $600 combined SUB.
Chase even uses the words "relationship" in their "Offers For You" section:
Another way that "relationship" may matter is shown in Bank of America's 3/12 or 7/12 policy. (In general, you can have many more new total accounts if you are a Bank of America deposit account holder.) Do other lenders have similar (but unadvertised) policies which might affect underwriting approvals? Possibly.
On the lower end, I've seen postings from some of our newer members with thin credit profiles get approved for Chase cards MUCH earlier than I would have expected when they've been using Chase for their primary checking account. While I don't think opening a checking account and deposting $100 today helps you to get approved for a Chase Freedom Flex tomorrow, I do think that generally speaking the more business you give most lenders and the longer time that you are a client, the easier it will be to get lucrative SUBs, preapprovals, and more attractive terms. The evidence seems compelling to me and not simply antedotal.
@Ragdollkitty wrote:I haven't researched this "private bank" wealth management stuff much as I'll never have that much money. A few weeks ago, out of curiosity, I asked a friend who'se mother qualifies for this stuff if they use it, and his response was that she has avoided it bc the management fees for this type of stuff are usually around 1% a year, so $100,000 on ten million.
1% is not much compared to someone like UBS. You could expect 3% or higher depending on type of account.
@Aim_High wrote:@ToxikPH wrote:I'm thinking of re-opening a Chase checking and opening a YouInvest account to build up a relationship in order to be better suited for an approval once I'm under 5/24. Is a relationship important at all for their cards or am I fine without opening the accounts?
Thanks for the topic, @ToxikPH. This is always a popular and sometimes divisive one, but good to discuss.
I think saying either "yes" or "no" to whether relationship matters to Chase or any other bank is an oversimplication in most cases. It also depends on your objectives and HOW you expect your relationship with the bank to be beneficial. The great majority of lenders want to do business with you beyond just opening a credit card and may factor your overall relationship into the opportunities they offer you. Some are more open and vocal about it than others, such as with Navy Federal's internal "relationship score" you get to see if you're denied a NFCU product. Who is to say that other lenders don't also use such algorithms in their approval processes? Even if lenders don't use an objectively-scored number, they may use subjective relationship criterion in manual reviews.
And yes, there are members on My Fico who have used the strategy of opening accounts prior to applying for credit cards to get prequalified offers, to increase their odds of approval, or just to try to increase the approval terms such as starting limits. Sometimes, having significant deposits with a bank for awhile or moderate-to-heavy banking activity appears to help with higher relative starting limits or credit limit increases. From my observations and remarks from others on the forums, this technique does seem to often help "grease the skids" before applying for cards in lieu of simply cold-apping. One of our members who has seemed to master this technique is @Mahraja but there are others as well.
But back to your basic question: If I'm under 5/24 and I want a Chase credit card, do I need to open banking accounts to get approved for a new card? The answer is no. I have never had a Chase checking account, savings account, investments, mortgage or auto loan. I've been a Chase credit-card (only) customer for 20 years. I currently have six open Chase credit cards with total credit lines of $138.4K. They are by-far my largest single lender and I don't have $1 in any accounts with them. They apparently like my single long-time card history combined with my high credit scores and high income. Still, I believe relationship matters to some degree, even with Chase.
Chase is the largest bank in the US with more than $3 TRILLION in assets. So of course it's going to take more to "impress" them than some other banks! A smaller regional bank in a small community may fall over themselves tending to a client with only $100K invested versus the $10 Million figures quoted earlier. It's all relative. But I believe that saying a banking relationship with them is either $10 Million or nothing is an overstatement.
For credit unions, one typically has to join by opening a "share savings" account with a minimal deposit. For other financial instituions, someone with a good or better credit score, good income, reasonable debts, and an acceptably-low ratio of new inquiries or accounts can usually get approved for the the majority of credit cards without having to open deposit accounts. There are a few exceptions, such as someone without any type of US Bank relationship trying to apply for an Altitude Reserve card, which is specifically advertised for bank customers. Or maybe the Bank of America's Premium Rewards card, which data points have shown that odds of approval are low without at least a checking account; cold apps are often denied. Or HSBC's enrollment in their Premier Program to qualify for the Premier World Elite Mastercard. But generally speaking, you rarely HAVE to have banking relationships to be approved for most cards. And this is the point that many have made above, with which I agree.
On the other hand, the $10 Million clients with Chase Private Bank are the ones in the highest tier of personal service with Chase and the ones who undoubtedly have the "best" or most customized service. They're in a league of their own. Yes, these are the ones who qualify for the invitation-only JP Morgan Reserve card (previously the Palladium card.) But that's not what you're asking about, so bringing up the $10 Million deposits seems a little off-topic IMO. The problem is that this is the best quantified data point about Chase card approvals, but does that mean that smaller relationships mean absolutely nothing? I beg to differ.
There are also the customers with at least $250K invested, who qualify for the much-lower "Chase Private Client" program. While they bring less to the party, and don't warrant the high levels of personal service, there's a LOT more people who qualify for this level. Even though they are more common comparatively-speaking, they are still a pretty exceptional group in terms of overall US Population wealth. (Statistically, the median household net worth in 2010 was only $68K. These are all families who are probably in the top 25% or higher.) Forty of them together may make up the wealth of a Private Bank client. You can believe Chase doesn't want to drive them away in droves, and is willing to spend at least some energy grooming them. That's just smart business.
I have found that once you have some type of product ("relationship") with a lender, it often does lead to offers to "deepen the relationship." So if your objective with a lender is more than one single credit card or great SUBs, the relationship may matter more. For example, I don't bank with Wells Fargo but I was added to my two daughter's checking accounts when we set up accounts for them near their colleges. I also had two co-branded cards from WF a few years ago which I have since closed. They recently sent me an unsolicited preapproval for the Cash Wise card with a SUB, which I just completed. They approved me regardless of a very high number of other new accounts. I have gotten targeted offers from Bank of America and now from Chase to open checking accounts with higher than off-the-street SUBs. I'm planning to take up Chase to open checking and savings for the $600 combined SUB.
Chase even uses the words "relationship" in their "Offers For You" section:
On the lower end, I've seen postings from some of our newer members with thin credit profiles get approved for Chase cards MUCH earlier than I would have expected when they've been using Chase for their primary checking account. While I don't think opening a checking account and deposting $100 today helps you to get approved for a Chase Freedom Flex tomorrow, I do think that generally speaking the more business you give most lenders and the longer time that you are a client, the easier it will be to get lucrative SUBs, preapprovals, and more attractive terms. The evidence seems compelling to me and not simply antedotal.
Let me reword it...as a former corporate Chase employee, they usually (98% of the time), don't care about a relationship unless you have upwards of 10 million dollars. They may give you the lip service of "relationships" and thank you for your long standing loyalty, but as someone who has worked in underwriting, it goes in one ear and out the other. The only aspect of relationship they care about is whether you've done them wrong in the past. You want a relationship go to BofA, Wells, US Bank, or a credit union, cause Chase is about that single life.
Private client bankers have no pull. They have to call in favors to underwriting.
Just for You offers are based on the most likely cross-sell with the least amount of risk. In my case, they don't offer any cards unless I run a couple hundred thousand through my checking. At that point, an offer will pop up while the money is there, disappears as soon as I stop moving money through it. Guess me being a former employee and having an account since they took over WaMu really didn't hold any weight. Lol, I forgot, employees don't get preferential treatment, they have to go through the same process and meet the same criteria.
Mailers are done by a 3rd party hired by chase. They buy a list of names from the bureaus based on very loose criteria because they get paid on the number of apps.
Believe what you want. The marketing is designed to make people think the way you just did.
@Remedios wrote:I promised myself I won't be telling this story again...but...
Several years ago I applied for one of freedom cards. I got denied for short credit history. I was CPC at that time, and as far as money goes, money from sales of two homes in Bellevue and one other smaller property in Seattle was sitting at Chase.
On the banking end, I could have asked them to walk my dogs and they would find someone to do it.
CC lending didn't give 🐀s bum.
A year later they approved stupid card, followed by another one three weeks later, when reason for denial no longer was applicable.
Did I mention I had two paid off mortgages through them...
I've banked with them since they bought WaMu, so my entire financial life went through chase for at least 20 years.
To think that stashing some amount or using checking to pay a few bills constitutes a relationship ...that's just diluting yourself.
Entities do not relate to people. They will enter into a business relationship whenever it makes sense for them.
They are in business of approving whenever possible, but not because you opened DDA. They don't carefully watch over your checking and rejoice whenever deposit is made.
Each department's performance is tracked separately. CC division won't take a possible loss just because your banker thinks they should. Mortgage guy/girl won't step on any toes.
Can you imagine a situation in which someone from CC division calls mortgage peeps and ask they give you a house just because you have a card?
If that sounds ridiculous, how about this "Let's give them a card because they have checking"
Good call out. Completely forgot about the separation of departments. Auto can't see banking, CC can't see auto, etc. They have absolutely no bearing on approval of one another.
This is actually a pretty interesting thread to me. As a small fish in a big pond, I have never had any real relationships with any bank. I have used Chase 10 years as my primary checking, my balance isn't anything to write home about. The last time I worked with a banker in person was when we were adding my wife my acount a couple of years ago. I occasionally interact with a teller (but haven't all year and usually just get cash from the ATM unless I want bigger bills for some reason).
I am not just rambling, where I am going with this is two fold:
1) I think @Remedios story has solified something that I am slowly starting to realize, I am just another number to any bank an probably even to credit unions. Smaller banks (like BBVA) may put on more of a personal show but in the end we are just a number and a way to make money for the insitution.
2) With number 1 being the case, I see no reason anymore to be loyal to any single bank. I will probably keep using Chase as my primary checking since I have had no issues with them but if something better comes along in the short term, I will be more open to moving money around moving forward.
To the OP, if you want the card and are below 5/24, I would just cold app if I were you.
@sxa001 wrote:This is actually a pretty interesting thread to me. As a small fish in a big pond, I have never had any real relationships with any bank. I have used Chase 10 years as my primary checking, my balance isn't anything to write home about. The last time I worked with a banker in person was when we were adding my wife my acount a couple of years ago. I occasionally interact with a teller (but haven't all year and usually just get cash from the ATM unless I want bigger bills for some reason).
I am not just rambling, where I am going with this is two fold:
1) I think @Remedios story has solified something that I am slowly starting to realize, I am just another number to any bank an probably even to credit unions. Smaller banks (like BBVA) may put on more of a personal show but in the end we are just a number and a way to make money for the insitution.
2) With number 1 being the case, I see no reason anymore to be loyal to any single bank. I will probably keep using Chase as my primary checking since I have had no issues with them but if something better comes along in the short term, I will be more open to moving money around moving forward.
To the OP, if you want the card and are below 5/24, I would just cold app if I were you.
You nailed it. I keep chase around because I can always depend on them when I have something important, but I put most of my money in other banks and CUs because of various reasons, the most common being that the others pay me more to let it sit there.