How Long Should You Wait between Applications with Chase?

Yesterday I outlined my Spring App-O-Rama. I mentioned I applied for two Chase cards, but on the other hand Chase can also be very picky about rejecting people who file new applications too often. Sometimes their applications will also ask if they’ve previously rejected your application in the last six months, a potential deal-breaker. Deciding how often you can apply is a very important question since Chase has some of the best credit card offers out there as well as some of the best customer service.

A lot of people will tell you to file a new application with Chase every six months. In my experience, I’ve been cutting the time between applications down by a month with each new card. I got the United Mileage Plus Select Visa back in 2010 followed by the Continental OnePass MasterCard in early 2011, six months later. Then I got the Hyatt Visa five months after that. The Chase Sapphire Preferred was next after four months. And just last night I applied for the United Club Visa after only three months since my last application. It was also my first instant approval from Chase! So go figure. Apparently if you want an instant approval, you need to apply every three months. (Please note the sarcasm.)

Of course, I try to maintain a good banking relationship with them. I actually use all of my cards and pay the annual fees. The benefits are worth it. I get a $60 credit on the United Select card since I’m 1K, and the remaining $35 is worth getting 3X miles on purchases instead of 2X with the current Explorer card. The $75 fee for the Hyatt Visa is worth the free night each year. And the Ultimate Rewards card is valuable just for the easily transferrable points. Other cards like the Priority Club Rewards Visa also offer a free night or similar offsetting retention bonus that you don’t even have to ask for.

The only card I’ve canceled with Chase is the Continental OnePass Plus card, now rebranded as the Explorer card. It just isn’t a useful card. I don’t care about free bags or Priority Access as an existing elite. I don’t care about upgrades on award trips since I don’t fly award tickets myself. The 2X miles on purchases is inferior to what I already have with the Select card. The only thing that would be worthwhile is primary car rental insurance, but I have a low deductible and rarely rent a car anyway. I explained these failings when I canceled it in February.

I’m still waiting to hear about the Ink Bold Visa application, which I filed just before the United Club application. In general the rule is that you can apply for one personal card at a time from Chase, but you can double down by also applying for a business card on the same day. It doesn’t surprise me that they probably will want me to call up their reconsideration line since I have a new business (this blog) operating as a sole proprietorship under my Social Security number instead of an EIN. But I don’t expect any real problems, and I have well over $40K in available credit lines at Chase that I can cut or redistribute. I’m using less than 5% of that each month, but maintaining a high line of credit gives you leverage to negotiate.

Maintaining a Good Credit Score

As the Frugal Travel Guy likes to say, your credit is your most important asset. Always pay attention to your credit score and how your decisions affect it. Are you applying for a house in the next two years? Maybe you should lay off the churning, or at least cut it down to one every six months. Are you going to be carrying a balance? Rewards cards are a bad idea as they usually have higher interest rates.

In my case, I only spend what I can afford, and I always pay off the balance in full each month. Responsible card churning can actually raise your score by increasing the number of accounts and decreasing the ratio of debt to credit even though it may decrease the average account age. I use CreditKarma.com and CreditSesame.com to give me estimates of my credit scores for free.

Credit Karma credit rating screenshot

CreditSesame credit rating screenshot

A low score is a big reason why your application might be rejected, but even a high-score guy like me has had trouble now and then if I don’t pay attention to recent account openings or closures or unusually large balances that I haven’t yet paid off. In fact, opening a savings or checking account can sometimes create a pull that will temporarily decrease your score. Like all things, plan carefully.

Scott created Hack My Trip after learning how to travel better on a budget during grad school. He now flies over 150,000 miles every year.
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  • Jimgotkp

    I hope you tried to waive the annual fees by calling the retention department a few months before the annual fees are due… 

    • Scottrick

      Nope, sorry. I always pay the fee if it’s a card I want to keep. I even have a hard time using Amazon Payments to reach the minimum spend. For whatever reason, it rubs me the wrong way. Megan says I have an honesty problem (seriously, the last time I gave a practice talk in lab, my advisor buried his face in his hands at said, “Do not, DO NOT, say ‘the laser is finicky.'”)

      • http://profile.yahoo.com/HNP67O2AGWYHIT6YGV7B4GPSNA Jigar P

        … this sounds surprising and somewhat unsatisfactory from a blogger behind “hack my trip”

        • Scottrick

          I guess I have this issue with not paying for something I find useful. For example, I hate haggling. If you’re not offering a fair price, I’ll just walk away and do without. Street merchants hate me. The card is useful, and I’m not paying that much. I am still getting more value than what I pay, so I’m satisfied.

          Other stuff I do like using ITA to book cheap trips is just knowing how to find the lowest price. Fuel dumping is getting closer to crossing the line. But in that case, the airlines are using this stupid fee instead of just raising the fare, and they’re charing four times as much to go only twice as far. It’s not worth what they’re charging, so I found a way to take the price lower.

          • shay peleg

            Haggling is the bomb!

  • DrKymeD

    I applied for Chase Freedom back  on 7/2011. Approved.  January 2012 applied for Chase Sapphire Preferred and was immediately approved.  Three months later–now April–I see the Avios advert and since I travel abroad frequently, I really want the smartchip  (and the Avios points, I can make the 20K annual spend) . So I applied–and received the dreaded “pending review” reply.  Is it because I’ve applied three times in the past 10 months?  Excellent credit score, own my 500Khome, retired with investment income and trust fund….Must be the frequency of application.

    • Scottrick

      I don’t think “Pending Review” is that dreaded. I get this message half the time and only once has it resulted in a rejection–one that I probably deserved because I had just closed four credit cards and opened a new checking account in the last week. Yeah, that doesn’t look suspicious :P

  • Phil

    I cancelled a Chase Marriot card, how long until I can apply for a new Chase card (different one)

    • Scottrick

      That’s a tricky question. I normally recommend waiting until after your second card is approved before closing the first one. Canceling a card immediately hurts your credit score by reducing the amount of available credit (increasing your debt to credit ratio) and decreasing the number of open accounts in good standing. And when you are reapplying to the same bank, it makes you look more like a card churner and less like a longterm customer who just wants another line of credit.

      Since a card should be left open at least six months to prevent the points from being revoked, and new accounts can be opened with Chase as little as every three or four months, it is very possible to leapfrog like this and still close a card before the annual fee is due. Three months is the minimum time between new Chase cards that I feel safe with. Others may prefer six months.

      However, you’ve already closed your old account, so it’s too late. My advice to you is that you wait at least one or two months, but I’m not sure this will matter much. Instead, treat it like any other card churn and make sure all your balances are as close to $0 as possible, that your cards are in good standing, that you haven’t applied for any new credit in the last three to four months, and that you have a good estimated credit score according to Credit Sesame or Credit Karma.

      • Phil

        Thanks-I think I’m ok on the debt/credit ratio, and this was a card open 10 months so the long-term impact on my credit will probably be minor.  I pay off everything  monthly and in full, so I guess I can wait until the balances are at zero, switch to my wife’s card for a bit and apply in 90 days or so

  • http://www.facebook.com/rockithomas Rocki Gamblin-Thomas

    I am going to have to bookmark you! I can only pay the minimum on my cards for the most part, will that hurt my credit? And do store cards help raise your score, because I have mainly store specific cards with no visa or MC logo on them. I have on capital one card and also care credit. The rest are store specific.

    • Steve Medel

      If you are holding a balance on your credit cards then rewards programs are not for you. Typically rewards cards have higher interest rates and holding a balance will completely negate any value the rewards would have. My advice to you, once you are at a point that you can pay off your cards completely before the interest accumulates from month to month, then pursue a rewards card.

    • Scottrick

      I agree with Steve. Don’t start churning rewards cards until you can pay them off completely every month. But to answer your other questions: (1) Only paying the minimum will not hurt your credit. But carrying a balance does hurt your credit because you are using more of your available credit. When you use less, you are a lower risk. (2) Store cards help raise your score because they are a unique type of credit. More types of accounts provides variety, which is good. I once opened an auto loan (for a small amount) just to have some diversity on my credit report.

      If you want to open new accounts, start with those that have no annual fee, such as the Chase Freedom. If your score is good enough already (and you can check it with Credit Karma or Credit Sesame) you might try opening the account now even if you don’t use it actively. I believe the Chase Freedom is also running a balance transfer offer right now with a 0% introductory rate, so look into that if you want to move the balances from your existing store cards. (There is often a 3% fee for the transfer, but that can still save money over time if the new balance is no longer earning interest month to month.)

      • shay peleg

        Well it does hurt a bit because credit card companies have secret formulas and i bet you not carrying a balance improves it