Acquiring new credit card customers has become expensive for banks, with escalating signup bonuses. 50,000 or even 100,000 point offers are more expensive than the 15,000 points that were common 15 years ago. That only makes sense for banks if customers will spend a good amount of money on their card products over a long period of time, or rack up large fees (while paying off their balances).
Chase, though, seems to be tougher at even approving cardmembers for new products — not if they’ve had the products before, but if they’ve signed up for several cards recently. Yahoo! Finance wrote about Chase getting tougher approving new cardmembers who apply for ‘too many’ credit cards. (HT: Dan R.)
If applicants have opened more than five new lines of credit in the last 24 months, Chase underwriters are more likely to deny their application for a new Chase credit card — even if they’ve got stellar credit.
…Chase spokesperson Ashley Dodd told Yahoo Finance said she could not confirm that the 5/24 rule exists but did say having too many new credit accounts doesn’t look great. “To continue providing valuable offers that attract those types of customers, we have restrictions related to the number of new cards customers can receive in a period of time,” she said.
There’s one fact that the Yahoo Finance piece gets wrong, though. They report:
Chase hasn’t been shy about another rule that makes it tougher to churn and burn. Applicants who have opened a Chase credit card within the last 24 months and received a signup bonus will not be eligible for that bonus again.
In fact, the rule that they will only welcome back a customer with another bonus on a card they’ve had before if it’s been at least 24 months since they’ve had the bonus can’t really be called a rule that was implemented to make it tougher on folks who are just in it for the bonus.
That’s because this rule replaced the earlier one bonus per card product in a lifetime rule. It was Chase becoming more liberal, making it possible to welcome back past cardmembers who may have had a product before, and might want to become a long-term customer again in the future.