I was the first person to report over the summer that Chase would be expanding their 5/24 rule. Chase doesn’t approve most applicants for their cards who have opened 5 or more new credit card accounts in the previous 24 months. This is too blunt of an instrument.

5/24 Can Harm Chase Partners and Keep Them From Growing Their Niche Portfolios

The idea here is Chase does not want to invest a costly signup bonus on someone who is moving from card to card. They only make their money back acquiring a customer if that customer keeps the card and uses it over time.

However this is a fairly blunt instrument.

• It means there are Marriott ‘Ambassador’ members who spend over 100 nights and $20,000 with the chain, with perfectly good credit, who want to carry the brand in their wallet. They apply for the Marriott Rewards® Premier Plus Credit Card and get rejected.

• It means there are United Global Services members spending over $50,000 a year with the airline who want the United co-brand — which is a pre-requisite for getting upgraded on domestic award tickets — and who get declined.

Meanwhile I think that the World of Hyatt Credit Card is a fantastic card. But the market for the Hyatt card is relatively narrow. Hyatt has a limited footprint. They have the best elite program if their hotel locations works for you. Most people with a Hyatt card aren’t going to just have a Hyatt card. As a result 5/24 seems disproportionately likely to keep the bank from building its Hyatt portfolio.

Better to Approve Customers Without a Signup Bonus

American Express has a different tact. They only allow one initial bonus per card in a lifetime (lifetime being as long as their records reflect you’ve had the card before). More recently they’ve added additional unpublished hurdles where they decide you may or may not be eligible for a bonus. But they tell you in advance during the application process whether or not they’ll give you that bonus. They let you apply, and will approve you for the card, either way.

In contrast Chase won’t give you the card at all if you’re at 5/24. I’ve written that I believe Chase ought to follow the American Express lead here and at least be willing to approve customers for their cards, albeit without a bonus. That has largely upside — a customer getting a card without bonus is likely to keep the card and likely to use it, and it’s less expensive to acquire that customer.

Of course that would take a focus and investment at Chase in creating the algorithm and separate approval path, and they haven’t shown any inclination to do that. Co-brand partners like United and Marriott should be pushing them to do so.

Expanded 5/24 Re-orders Which Cards to Get First

Now that 5/24 appears to have expanded to more cards the strategy over ‘which cards to get first’ changes.

• If you’re under 5/24, start with Chase business cards. While they are subject to 5/24 (you need to have fewer than 5 new card approvals in the last 24 months to be approved) they do not seem to increase your total (if you’re at 3/24 and get a new Chase business card you stay at 3/24).

  The Ink Business Preferred℠ Credit Card has the best new cardmember bonus in the market in my opinion offering 80,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.

• Get other business cards first. The CitiBusiness® / AAdvantage® Platinum Select® World Mastercard® with its B>70,000 mile initial bonus after spending $4,000 within the first 4 months of account opening and $0 annual fee the first year (then $99) won’t increase your 5/24 total. Neither will the Blue Business℠ Plus Credit Card from American Express which earns 2 Membership Rewards points per dollar on your first $50,000 in purchases per year and is the best most rewarding card for otherwise-unbonused spend. [Offer expired]

American Airlines Boeing 787-9 Business Class

If you’re under 5/24 and want a Chase personal card my recommendation is the Chase Sapphire Preferred card.

1. It has a great initial bonus at 50,000 points after $4000 spend within 3 months.

2. It’s easier to get approved for than Sapphire Reserve.

3. Points transfer to United, British Airways, Southwest, JetBlue, Singapore Airlines, Virgin Atlantic, Iberia, Aer Lingus, Air France KLM, Hyatt, Marriott and IHG.

4. There’s no annual fee the first year then $95.

5. You can request to product change after that year to a Sapphire Reserve (in my experience the easiest path to getting one) or to a no annual fee Freedom or Freedom Unlimited card. Having a card that can be product changed is useful given Chase’s restrictions on getting approved for new card accounts.