Is Credit Card Churning Bad? One Card Once In A While

I am perfectly happy signing up for a new card every once in a while and receiving a nice spend bonus. If the card makes sense for me, I’ll keep it. If not, I’ll look for a different card that will meet my needs. You can still get a ton of value out of certain cards but you have to know which ones to look for.

Churning Barclaycard credit card can be tempting because they have some good deals. The Barcalycard Arrival Plus card is one of my favorite cards right now because it offers a 40,000 point sign-up bonus and it gives you 2% back on ALL purchases. There is an $89 annual fee but that can be offset by the 2% cash back compared to the standard 1% cash back on other cards. But is credit card churning bad?

Don’t Ding Your Credit Score

When it comes to credit card churning the effect on credit score can be a problem. Most ‘credit card churners’ like to talk about all the success they’ve had but they often ignore the negative impact that churning can have. The biggest negative, in my opinion, is the hit to your credit score that opening up multiple cards can have. Every time you open up a new card, your credit score will take a slight hit due to the fact that you now have one more credit inquiry and since that card is brand new, it will lower the average age of your accounts.

If you were to keep that card for a long time, it would eventually recoup that initial credit score hit (since inquiries fall off your report after two years) and then some since your average age would increase as the card got older, having another card would add to the overall number of accounts (the more, the better) and the utilization portion of your score would go up (more available credit helps your score).

But when you open a card and cancel it within 1 or even 2 years, this can have a big impact since even though that account is closed, it will still bring down your average card age for the next 7 years! That is one of the reasons why you want to do your best to find cards that make sense for the long haul and why the answer to, “Is credit card churning bad?” can be “Yes.”

Blacklisted By Your Bank

The last thing that credit card churners don’t like to talk about is being blacklisted by your bank. Credit card companies are able to offer such good incentives for signing up for a new card but if everyone were to churn cards it wouldn’t be financially possible to continue this practice.

I’ve seen reports of multiple banks closing cards and denying future apps for serial credit card churners. So not only will you run the risk of being denied for a credit card but you could lose a valuable banking relationship indefinitely if you get caught churning. When it comes to credit card churning risks are involved.

So, does credit card churning hurt your credit? Yes, it can. I know this would be a big deal for me since I have my business checking account with Chase and my mortgage with them too. So if you’re going to take advantage of these great offers, as with anything in life, remember that moderation is the key.

Barclaycard Arrival Benefits: Free TripIt Pro Subscription

On the surface, TripIt Pro is known for managing all of your travel reservations but it actually does so much more. I use it to track everything from hotels and reservations to flights and rental cars. It will even help you pick the best seat on your flight and send you 24 hour check-in reminders by e-mail and/or text.

TripIt Pro also automatically categorizes your travel plans into logical trips and since it’s linked to your e-mail it will auto-import new itineraries and reservations as soon as they come in. Normally you would have to pay for all of these premium features, but as an Arrival or Arrival Plus cardholder you actually get them for free.

Free FICO Score – All Cards

In the past, I was content using sites like Credit Karma that provided a ‘FAKO score’ but whenever I compared it to my actual FICO score, there would always be a wild difference. If you want to see your true FICO score, you will generally have to pay for it. But Barclaycard recently added a Free FICO score feature on all of its cards. It updates once a month and it’s the same score that lenders and banks will use when they pull your credit.

Chip & PIN

If you travel to Europe often, you know that nearly every card over there is what’s known as a Chip & PIN card. Some merchants take regular old credit cards but a lot of them actually require a Chip & PIN now. You’ll especially need a Chip & PIN card if you try to buy anything at automated kiosks like those at a train station for example.

The Arrival and Arrival Plus recently switched to this new format and coupled with no international transaction fees, that makes it a no brainer to take with you when you’re traveling abroad.

2% Cash Back on All Purchases

We all know that the standard cash back rate for most credit cards is 1% or 1 point per $1 spent. It’s nice to get that cash back, but it will often take a lot of spending before you build up a significant amount of points. The Barclaycard Arrival Plus card changes all that though since you get 2% back on every single purchase!

A lot of other reward cards limit 2% back to certain categories like groceries or gas but not the Arrival Plus. Cashing in the points is pretty easy too since you can redeem them against any travel charge over $25.

10% Miles Redemption Bonus

With the Barclaycard Arrival benefits just keep coming. Barclaycards is also one of the only card programs that offers you a bonus when you spend the miles in your account. Any time you redeem your miles for a statement credit, you’ll get an additional 10% bonus, bringing your effective cash back to just over 2.2%.

Reward Boost Online Shopping Portal

Many people might not realize that Barclaycards has one of the top online shopping portals around. Here’s how it works: any time you need to make a purchase online, just log onto their shopping portal and see what kind of cash back incentives the portal offers. By starting in the shopping portal you can get additional savings on purchases you would have made anyways.

Each Barclaycard has its own shopping portal but the Reward Boost Online Portal is specific to the Arrival Plus and the Arrival card.

Great Customer Service

Barclaycard Arrival benefits also include service; one of the things that’s been most surprising to me is the awesome customer service Barclaycard provides. I’ve opened two separate cards with Barclaycard now and both times their agents have been a pleasure to deal with.

You also have the option to send them an e-mail from your dashboard and they should respond within 24 hours. For faster service, you could also try contacting them on social media. They have an extensive team on Twitter waiting and ready to answer any questions you may have. Finally, the Barclaycard also gives you options. Wondering about the Barclay arrival fee vs no fee card? The fee is there for a reason, because often a card with a fee offers better cash back or other benefits, so compare both cards and make an educated choice.

Barclaycard Arrival vs. Arrival Plus: Which Card Is Right For Me?

If you’ve decided that you need to add a fixed value card to your arsenal, now you need to figure out which card is right for your situation. Both cards offer no foreign transaction fees and like we already mentioned, redeeming points is very straightforward with both cards.

The biggest difference between the two cards probably lies with the annual fee. The Arrival Plus has an annual fee of $89/year (the first year is waived however) while the Arrival has no fee. The reason why the former has the higher fee is two-fold: it offers a higher sign-up bonus at 40,000 points compared to just 20,000 with the Arrival and it get 2 miles back per dollar spent on every purchase while the Arrival only gets 2 miles back per dollar on travel and dining purchases and 1 mile per dollar on everything else.

Is The Fee Right For Me?

One difference in Barclaycard Arrival vs. Arrival Plus is fees: should you choose Barclaycard arrival fee vs no fee? Generally I try to avoid paying annual fees but since the Arrival Plus is one of the only cards to offer 2% back on every purchase, it could be worth it depending on your situation. Remember, the annual fee is there for a reason. It has to make up for all of the better benefits that the Arrival Plus card offers.

Barclaycard Arrival vs. Arrival Plus: Arrival Plus Offers a Higher Sign-Up Bonus

The first one of those better benefits is an increased sign-up bonus. The Arrival Plus has a sign-up bonus that is 20,000 points higher than the Arrival. And that 20,000 point difference is worth about $200. So by opting for the Arrival Plus over the Arrival you are really getting the card free for three whole years (remember the first year annual fee is waived).

Barclaycard Arrival vs. Arrival Plus: How Much Do You Spend?

It might be tempting to open the Arrival Plus to score the higher bonus and then cancel the card once the annual fee comes up but remember that could have a negative impact on your credit score. Instead, you want to look for ways that the Arrival Plus could actually pay for itself. One of the best ways is to figure out how much you spend.

Since the fee is $89, we know that in order to break-even on the fee you need to spend more than $8,900 in a single year. Here’s how the math works out: if you spend $8,900 per year that would give you an extra $89 in cash back with the Arrival Plus card compared to the Arrival. Most people definitely spend over $742 ($8,900/12 months) per month on their credit cards so you will likely come out ahead by opting for the Arrival Plus card.

The Best Airline Mile Credit Card Offers more Than Just a Sign-up Bonus

A lot of airline cards like to market their huge sign-up bonus offers when attracting new customers. They go something like this: “Sign up with our brand new card and you’ll get 50,000 points or enough points for two round trip flights!” That sounds great but what if you’re a busy traveler and you quickly use up those two free flights?

Now you’re stuck paying for your ticket plus all of the little extras. But that’s where the best airline mile credit cardcan come in handy. See, airline cards offer more than just enticing sign-up bonus offers. They offer a wide variety of ancillary benefits that can save you a bunch of money. So, what’s the best credit card for a traveler? One that offers all these benefits:

• Free Checked Baggage: This is probably one of my favorite benefits since I hate having to carry on large suitcases. Weekend bags aren’t a problem, but when you have to lug a giant suitcase around the airport and try to jam it in an overhead bin, that can be pretty stressful. It’s nice checking in your bag for free and not having to worry about it until you land.
• Priority Boarding: Have you ever noticed how many people start to line up at the gate before boarding starts? Well if you have an airline card that offers priority boarding you won’t be one of them since you’ll get to board right after the business class passengers.
• Companion Passes: I think companion passes are one of the most under-rated benefits of airline credit cards since you can really take advantage of that free ticket. Most companion passes can only be used domestically but they are also great for last minute travel since you’ll effectively pay half price for two tickets.
• Lounge Access: Flying during peak travel times can be a real headache and often times there isn’t even a place to sit down or charge your phone at airport gates. In order to remedy this, a lot of airline cards are starting to offer two free lounge passes every year that you’re a cardmember. Some cards like the Citi Executive card will even offer you Admirals Club Access for an entire year (but that privilege does come with a hefty annual fee).
• No Foreign Transaction Fees: If you’ve ever tried to use your credit card in a foreign country you already know that most banks will levy high fees on international purchases and have credit card fees overseas. But a lot of the top travel cards have no foreign transaction fees since they know their customers are travelling all over the world and this benefit can save them a lot of money.
• Reduced Award Travel: Several airline cards are starting to offer this benefit since it allows you to buy an award ticket at a discount. Most of the time you can get a saver award for a 5,000-10,000 point discount based upon availability.

Are the Perks Worth it?

When you consider the fact that most airline cards waive the first year’s annual fee, give you up to 50,000 sign-up bonus points and adorn you with all of these perks, signing up for a new airline card should be a no-brainer! Some people like to cancel these cards once they have to start paying for them but if you fly just once or twice on that airline it might be worth it to keep that card.

Why You Should Wait

Credit card companies know that by using terms like ‘limited time offer’ they are going to entice more people to sign up for that card. If you can figure out what the baseline bonuses are for specific cards, as soon as you see the bonuses go up, you can jump on them.

In the past, a lot of credit cards were churnable, which meant you could apply for them over and over again and keep getting the sign-up bonus. Nowadays though, credit card companies are starting to crack down on these ‘churnable’ cards.

You Only Get One Shot

Amex recently announced a big change to their sign up bonus policy that stated, “Welcome bonus offers will not be available to applicants who have or have had the Card they’re applying for.” In the past, as long as you were applying for a new card 12 months after closing the old card, you would still be eligible for a new sign-up bonus. But this new policy is indicative of where a lot of credit card companies are headed.

Credit card companies don’t like giving out bonuses more than once for the same card. So it’s now more important than ever to ensure that you get the highest sign up bonus offer possible.

The Balance Transfer Credit Card Offers

Credit card balance transfer offers and point rewards can also be fleeting. They key to figuring out which balance transfer credit card offers are best is establishing a baseline. You’ll need to figure out what the standard offer is and keep an eye out for the increased offers. Here’s a list of some of the more popular limited time offers that we’ve seen over the past few years:

• Chase Sapphire Preferred – The standard offer for this card is 40,000 points but it often goes up to 50,000 points at various times throughout the year. If you see it at 50k, you should apply as soon as possible.

 

• Chase Southwest Premier/Plus – These cards generally offer 25,000 points but there are always 50,000 point offers floating around. You should always hold out for a 50,000 point offer with this card.

 

• Chase United Explorer – This card normally offers a bonus of only 30,000 points but it periodically goes up to 50,000 points in the summer time. Try to hold out for the higher offer of 50k if you plan on applying for this card.

 

• Chase Ink Bold/Plus – Ink is Chase’s business line of credit cards and the cards normally come with a 50,000 point bonus. But that bonus has gone as high as 60,000 points in the past.

 

• Amex Premier Rewards Gold – The PRG is Amex’s top of the line card and it usually comes with a 25,000 point sign-up bonus. From time to time though, Amex will increase this bonus up to 50,000 points and that’s when you should apply.

 

• Amex Starwood Preferred Guest – The SPG card by Amex has some of the most valuable points since they have over 30 airline transfer partners. The normal offer is 25,000 points but they often run summer time promotions that increase this to 30,000 points.

 

Accepting Credit Cards Online: Know the Time Limits

If your application goes down to the wire, you should still be eligible for the limited time offer as long as you get your application submitted before the offer ends. You’ll still need to be approved but a pending application doesn’t mean you missed out on the offer. It only means that the bank needs more time to review your application (but you will get the higher bonus as soon as you’re approved).

Basics on Reconsideration Lines

Sometimes you’ll apply for a standard credit card offer and a better offer will go live within a few weeks. In this case, you can often get your old offer matched to the new offer as long as the other terms (minimum spend, annual fee, etc.) remain the same.

Chase is one of the best when it comes to matching higher offers while with Amex it can be more difficult. The easiest way to get an offer matched with Chase is to just send a secure message from your account dashboard. Amex’s public stance is that they won’t match offers but I’ve had success getting them to give me ‘goodwill adjustments’ if better sign-up bonus offers come out within a month or two. You just have to pester them a little bit.

Citi still does it the old fashioned way: you’ll have to fax in a copy of the new offer if you want to get it matched.

Should You Apply For Multiple Cards in The Same Day?

Some people like to apply for cards in bunches but that could lead them to miss out on a limited time offer. There isn’t any real hard evidence that this strategy will help you either. Every application will cause a credit inquiry and I think it’s better to spread out the spend requirements so that you don’t have to do it all at once.

If you do decide to use this strategy though, you should apply to the most stringent banks first. Out of the big four banks, Barclaycard is usually the strictest so I like to apply with them first, Amex and Chase are somewhere in the middle of the pack and Citi is usually the easiest to get approved with, so I save them for last.

Hitting The Required Spend

The last thing you’ll have to watch out for with limited time offers is increased spending requirements. In general, when credit card companies are giving out more points, they want you to spend more. One recent example of that was the Citi Executive AAdvantage card.

Normally this card comes with a 50,000 point sign up bonus after you spend $5,000 in 3 months. But over the summer, they actually had a limited time offer of 100,000 points after $10,000 in spending (within 3 months). That’s a whole lot of points but it’s also a whole lot of spending.

How Credit Card Approval Works so Quickly?

If you’ve applied for a card recently you’ve probably seen promotional statements like “Get an Instant Decision” or “Approval in 60 Seconds or Less”. Nowadays, each credit card company has their own algorithm to determine your creditworthiness. They’ll take inputs like income, residential status (own/rent), credit history and more, and use all of that to make a decision. The application processing time could be anywhere from just a few seconds all the way up to a minute, or longer if they need more time to have a “live person” review your application.

We don’t know exactly how credit card approval works and what criteria banks use to determine instant approvals but there are a few things we know carry more weight than others. You should always ensure that you have a clean credit history with a low number of recent inquiries and of course the higher your credit score, the better. Income is also an important part of instant approvals since without income how would you pay back all the money you plan on spending?

Applications by Mail, Phone or Internet?

I still get targeted credit card offers by mail all the time but I rarely apply using that method. Instead, I like to apply over the internet or by phone since I can find out immediately if I’ve been instantly approved or not. If you’re sent a targeted offer for a certain card, there is usually an invitation code that can be used for online and phone applications. Both of these options will allow you to get an instant decision and possibly approval.

Just because you’re approved though, doesn’t mean you’ll get your card right away. It could take anywhere from a few days to a couple weeks after you’re approved to get your card. One trick that you can use to get your card a little faster is to call in and ask for expedited shipping after you get instant approval. Many companies will actually waive the shipping fee and you could have your card rush delivered for free if you ask nicely.

What Does It Mean If You’re Not Instantly Approved?

Unfortunately, not everyone is going to be instantly approved. If you have a low credit score you might even be instantly denied. It’s important to know ahead of time what your score is and what type of card you’re applying for. If you have a sub 700 credit score it wouldn’t make much sense to apply for Chase’s top of the line card: The Chase Sapphire Preferred Card.

Instead you might want to consider an entry level card like the Chase Freedom Card. That way you can establish some positive credit history and the next time you apply, you’ll have a better chance at getting instantly approved.

Your Application Needs Further Review

If the credit card issuer is unable to make a decision, they will usually set your application to pending status. All this means is that their computers are unable to make a decision at this time.

What to do if you’re not instantly approved

Think of it as being put on the ‘wait list’. They couldn’t quite justify an instant approval but they also weren’t ready to outright deny you. Pending applications are usually a good thing though since there are many strategies and tips you can use to nudge your application in the right direction.

Limited Time Offers Credit Cards: Chase, Citi and Amex Opt-Ins

With issuers like Citi and Chase, you’ll be automatically enrolled to receive promotional materials and marketing. Chase doesn’t send out many targeted offers but in my experience, when they do, it’s usually a big one. One of their best current targeted offers is for the Chase Sapphire Preferred and it comes with 100,000 points.

Citi likes to send out offers all the time so it’s up to you to filter through them all and find those top offers. Amex is probably the best when it comes to targeted offers but make sure that you’re enrolled to receive them. You can do this by logging in to your Amex dashboard and going to your ‘Profile’. From there, under Communication and Alert Preferences, select General Marketing Preferences. Make sure that you’ve selected ‘YES’ to receive all new card and credit offers.

Finding the Best Amex Limited Time Offers

Amex is known for some of the best ‘targeted’ offers in the business. Their standard Premier Rewards Gold (PRG) offer is 25,000 points but they often send out offers to targeted customers for 50,000 points. A lot of these special offers also come with reduced spending requirements. So instead of having to spend $2,000 in 3 months you’ll only have to spend $1,000 with a PRG targeted offer.

One thing I’ve noticed though in my own experience is that most companies use these targeted offers as a way to gain new customers. They won’t send out a 50,000 point targeted offer if you already have several cards with them. It’s when you’re just starting out that you’ll receive the best targeted offers and you’ll need to be ready to take advantage of them.

Finding Cards Through a Credit Card Match Site

Another tool that I like to use to do credit cards compare and find the best limited time offers credit cards is called a credit card match tool. A lot of the best offers aren’t made public because then there would be a rush of applications. A credit card match tool is a site that you can use to find some of the best targeted or limited time offers.

One of the best credit card match tools out there is the CreditCards.com Card Match Tool. I’ve often been able to find offers that are 1-2x higher than the current public offer. All you have to do is enter some of your basic information and the match tool will do the rest.

I was actually able to successfully match a few months ago with a limited time offer for the Amex Platinum Card that came with a hefty 100,000 point bonus. At the time, the highest public offer was only 50,000 points so the Card Match Tool gave me 50,000 extra points!

The Best Cash Back Credit Card: Don’t Wait Too Long

If I’m considering a certain card, I’ll do my best to wait around for a limited time offer but I generally won’t wait forever. The bonuses on some of these cards are constantly fluctuating but they are hard to predict.

So if you see a card that you like with a bonus that is suitable for your needs, don’t wait. There’s the chance that points could get devalued and be worth slightly less when you get them and it’s better to secure the points now in case the bonus actually goes down. You may not ever find the best cash back credit card and you will just have to settle for what looks good.

Summer Time Limited Offers

A lot of credit card companies like to use the summer as a time to release limited time offers. So this is an especially good time to stay vigilant for new offers. Here are a few examples of common summer time limited time offers for the best cash reward credit card:

• Amex: Normally increases the bonus on its Starwood Preferred Guest card from 25,000 to 30,000 points every summer. 30,000 points might not seem like a whole lot but Starwood has over 30 airline transfer partners and you can get up to 5 cents per point in value when redeeming at Starwood properties across the world.
• Chase: Although they have a wide variety of cards, Chase likes to raise the bonus on its entry level Freedom card towards the beginning of the summer. This is a great card for beginners because there’s no annual fee and it doesn’t require an extensive credit history.
• Barclaycard: Lufthansa and Barclaycard normally offer a sign-up bonus of just 20,000 miles on the Miles & More card but during the summer, it’s gone as high as 50,000 miles. Lufthansa is a member of the Star Alliance so you can redeem these points on United Airlines and not pay any fuel surcharge fees.

Limited Time Offers Aren’t The Best For Newbies

A lot of newbie credit card churners might be lured in by great limited time offers but remember that these cards often have the highest credit standards and spend requirements. If you’re just getting into the miles and points game, you should start with a more entry level card like the Chase Freedom or the Citi Thank You Card. These cards won’t offer bonuses in the 50,000 point range but you can still get a good limited time offer and get your credit headed in the right direction.

Application for Credit Card Declined?

There are lots of reasons why your application might not be instantly approved. The most common reasons that I see with my own applications are too many recent inquiries and maximum amount of credit extended by the bank. I apply for 10-15 cards every year so it should be pretty obvious why the bank doesn’t like to instantly approve my applications. But even with that being said, when I apply for a credit card online. I have never been denied for a card after calling in to the reconsideration line.

Apply for a Credit Card Online: Check Your Online Application Status First

As soon as you submit your application you should know whether you’ve been approved, denied or gone pending. If your application is approved, then there’s no need to call the reconsideration line. If an application goes pending, I like to call the reconsideration line immediately but you can also check the status of your application online with most card issuers. Here are the websites that allow you to check the status of your application:

• American Express

• Barclaycard

• Bank of America

• Discover Card

The online application status websites above are really only useful in situations where your application goes pending. I’ve applied for certain Barclaycard, gone pending and just minutes later my application was approved when I checked the status online.

I also like to use this feature if my credit card application ever times out. Sometimes the page might stop loading or show an error after you submit it. This is a great way to check if your application went through since you wouldn’t want to submit the same application twice.

Calling the Reconsideration Line

When you apply for a credit card online You can call the reconsideration line any time after you submit your application, but the earlier the better. If you wait 2-3 weeks or more, the bank could force you to submit another application which would mean another hard inquiry on your credit report. So if your application goes pending or is denied outright, you’ll want to call as soon as possible.

For pending applications, sometimes all the reconsideration line will need is to verify some info. But other times they’ll ask you questions like “Why do you need another card with us?” or “Why do you have so many inquiries on your credit report?” In order to give yourself the best chance at getting approved make sure that you have good answers to these questions and you have looked at a recent copy of your credit report. You can actually get a free copy of your official credit report up to three times per year at annualcreditreport.com

What to do if You’re Not Instantly Approved

For more strategies about calling the recon line:

When you call the reconsideration line it forces the bank to take a fresh look at your application again. So even if you’ve already been denied once, you’ll get an independent review and another chance to convince the representative that you are worthy of a new credit card. If you’re ready to give the reconsideration line a try, here is a full list of all available numbers for you:

1. Chase Credit Card Reconsideration

• 888-245-0625 Available 7am-10pm EST Monday through Friday, 8am-10pm EST Saurday and 9am-9pm Sunday
• 800-453-9719(business)

2. American Express Credit Card Reconsideration

• 877-399-3083 Available 8am-12am EST Monday through Friday, 10am-6:30pm Saturday

3. Citibank Credit Card Reconsideration

• 800-695-5171 Available 7am-12am EST Every day

4. Bank of America Credit Card Reconsideration

• 866-865-7839 Available 8am-5pm EST Monday through Friday
• 800-481-8277 (Business)

5. Barclaycard Credit Card Reconsideration

• 866-408-4064. Available 8am-5pm EST Monday through Friday