Miles hunter

[villemiami]

I'm applying to credit cards, mainly to get new member bonus airlines miles.

In October, I have to buy a new home AC system, so I'd like to apply for the Southwest Rapid Rewards Plus Visa from Chase.

I'd like to keep a good FICO score. It is 699 right now. I had 7 credit inquiries in the last 12 months.

These are the 3 credit cards I have:

Costco Anywhere Visa from Citi

No fee
start date: 1/27/18
credit limit: $4900

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United MileagePlus Explorer Visa from Chase
$95 fee
start date: 4/25/18
credit limit: $5000
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Gold Delta Skymiles from American Express
$95 fee
start date: 3/12/18
credit limit: $5400

 I finished getting my bonus miles with United and Delta, so I'd like to buy only with my Costco card from now on (so I get Costco cash back, instead of miles). Is that a good choice? or should I still use these 2 cards once in a while to buy things?

I paid no fee on the first year with United and Delta, but I want to avoid paying renewal fee. Is it OK to cancel my credit cards 1 month before the renewal date? or do you advise another date?

If it's really important, I can renew my United card and pay the renewal fee, because I can resell my free yearly United passes.

Like I said, I want to keep a good FICO score.

I don't mind keeping my Costco card forever because there is no renewal fee, and I'm an active Costco member.

[DollyLama]

If these are only your 3 open credit cards, in my opinion keep them open, it will take a year for the inquiries to age off and become unscoreable on FICO 8 perspective, may differ on underwriting ones, mortgage, etc. just use the other two to establish a payment history. To me, I'm afraid you will look as actively seeking credit and will get denials based on 3 new cards, 7 inquiries. You never want to close your oldest, since these were all in the same time frame, it wouldn't matter, but it's better to have 3 cards rather than one for optimatizon. Later as your cards age at least 1 yr, you will see a good bump in scores and the inquiries are no longer considered, then apply for a no AF card that works for you ie cashback. 

[villemiami]

So you don't advise me to get the Southwest credit card in October 2018, right?
My Costco credit card is a no AF card, So I don't need to close it, and it is my cashback card.
Would it be acceptable to close my Delta card 1 month before the AF in 3/12/19 ?
I could apply for the Southwest credit card in May 2019.
Also, can you confirm that it's OK to keep the United and Delta cards but not buy anything with it from now on (because I will use only the Costco credit card)?

[Anonymous]

Your desire to avoid paying future annual fees is a good one.  Before you settle on cancelling the card, first look into whether there might be a downgrade path to a no annual fee card:

https://www.doctorofcredit.com/best-downgrade-options-rules-for-each-card-issuer-rules/

[Anonymous]

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@villemiami wrote:

Also, can you confirm that it's OK to keep the United and Delta cards but not buy anything with it from now on (because I will use only the Costco credit card)?

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No.  That would not be a good idea.  After you fail to use a credit card for a long enough, the issuer will eventually close it due to inactivity.  To avoid closures due to inactivity, use a card once every six months -- that should be plenty safe.  (If the card is a Wells Fargo you might want to make that every 4-5 months.)

It's also not a good idea IMO to use a card only enough to get the bonus and then stop using it altogether.  You might get flagged as a bonus chaser which could make it harder to get cards from that issuer in the future.  Using it for something small every other month should prevent that.  And then if you choose to cancel a card at month 11 that's fine.

[villemiami]

Please look at https://www.doctorofcredit.com/annual-fee-refund-rules-for-each-card-issuer/

For example, it says "American Express will refund the annual fee completely if you cancel the card within 30 days after the statement in which the annual fee hits".

Can I just pay the annual fee, so it will be more than 1 year old, then I cancel the card within 30 days after the statement?

Is this a better option than trying to get a retention offer?

About the Southwest credit card, can I apply in October 2018 or should I apply in May 2019?

[NRB525]

OP, your plan to open and close cards after getting the bonus is something all the major banks are on to. They get what you want to do. And they have ways to shut down / limit what you want to do.

Are you getting the cards to add to your travel? Are you travelling for business, or only from these bonuses, with no further intent to fly unless it is on bonus? With the miles in your SkyMiles account, and United Miles account, if you can exactly redeem just the number of available miles you have, so you end up with zero miles and can walk away flush, kudos to you. My experience has been that use of miles for award flights rarely will match exactly what you have in your account, although with transfer from a card such as CSP/CSR or PRG, it would be much easier to do.

You also get some benefits from the cards, if you travel regularly on paid flights, such as a free checked bag.

The recent clarifications by AMEX on how they will handle bonus chasers are not encouraging. Your plan for how to cancel the Delta card is exactly what they call out as "possibly limiting future bonuses". Chase has the 5/24 rule, which you are getting close to, and that can, at some point, either block new apps or make you wish you hadn't apped in the sequence you did.

You have lots of time to figure this out. Do some reading, understand the benefits of the cards you have, and understand the consequences of the closure, particularly with AMEX and Chase.

Bonus chasing is getting more difficult. It can be done, but it takes planning.

[Anonymous]

As suggested already above, I agree with attempting a PC from an AF card that you grabbed a bonus on to a non AF card, especially if there's one that appeals to you that you see some value in. This is more of a win-win IMO overall for both you and the lender.

[villemiami]

I'm getting the cards to travel. I go once a year to France to visit my parents. I am the main custodial parent of my 2 kids. My ex has the kids only for vacations. Last year, I offered a timesharing agreement to my ex where I would pay half of plane tickets for the kids between my state and her state if she would pay me the calculated child support amount. That's when I had the idea of getting bonuses with credit cards. I paid 4 return tickets using bonus miles, then she decided to do only timesharing agreement with nothing on child support, so I stopped paying return tickets. But I'm going to court next week for child support, and the plane tickets deal will be back on table.

When I go to France, I'm paying with the credit cards to get these bonuses.

In 2 weeks, I'm going to bring my kids to the father of my ex and we will spend 5 days there. I paid using the United credit card and I got free checked bags.

About Amex, I'm planning to call the retention line.

About Chase, thanks for telling me about the 5/24 rule. Like dollylama said: "it will take a year for the inquiries to age off and become unscoreable on FICO 8 perspective". So if I pay the renewal fee for Chase, so it is slightly more than 1 year, then I cancel within 30 days, to get the refund of the fee, is this a working strategy?

[villemiami]

There is no downgrade with the United MileagePlus Explorer Visa Chase.