This is one in a series of posts that I am doing based around the January credit card churn that we did for Chrissy. Before reading this post, I would suggest reading my previous posts on What You Should Know about credit card churning and How to Pick Your Cards, if you haven’t already. Remember that you always want to protect your credit and at least in the short term, card churning will definitely have an effect on your scores. For more information about what factors effect your credit score, check out myfico.com.
Today I will be running you through the process I use for a churn day, using Chrissy’s churn as a specific example. Before you decide on a churn day, you should have spent some time to come up with a list of cards that you will be applying for, along with the links that will give you the highest bonuses for applying to each card. Make sure you are taking into account the required minimum spends and are not trying to take on more than you can financially handle. As you look at the specific cards that I am using for the example below, remember that this is Chrissy’s third churn day and she has already been approved for 13 other cards. The ones used for this churn may or may not be the best options for you to apply for at this point in time.
I follow several travel blogs and read message boards on a regular basis, so I like to think that I have a pretty good idea of what the current available credit card offers are. This really helps when preparing to do a churn because I already have a basic idea of what cards we will be applying for. Chrissy’s churn days are a little more challenging than mine because she doesn’t like to do the applications or make the follow-up calls. I have no problem doing this for her, but if a call is necessary, I need to make sure that I am making the call when she is home so that she can give permission for me to speak on her behalf. Once you have this many cards with all of the banks, a call is quite often necessary to get an approval. On your first churn, you might not need to make any calls.
For this churn, I did all of the applications during the afternoon and we made the follow-up calls as soon as Chrissy got home from school (she is a teacher). The cards for this churn are almost identical to the churn I did for myself back in October. Until then, I have been churning cards on the same day for both of us. In October, I decided to only do a churn for myself since I did not think we would be able to meet the spending on these cards if we got two of each at the same time. If you have the ability to meet higher minimum spends then by all means, you should be getting the best cards for your spouse at the same time as yourself. That is what we did for our first two churns, since we had lower total spend requirements with those cards, and it helps to build up your miles and points even faster.
As always, when applying for any credit card with a bonus offer, I recommend taking as many screen shots as you can with the bonus offer showing. This includes the page that you link from for the application, the actual application page in some cases, and the confirmation page if it shows you the offer. In certain cases, you may be using a link for an offer that the bank meant to end, and it is best to have proof of the bonus that you were offered in case they try to give you something less. This has not happened to me, but I have read many stories of this happening and I always make sure to have the screen shots on file until the bonus miles or points have posted to my account.
My plan for the day started out with 4 cards, then changed to 2, then I decided to add back in the 3rd, and finally after a conversation with Chrissy when she got home, I applied for the 4th one as well. Even the best laid plans can be changed by last minute thoughts, so make sure you are being flexible on churn day.
The first card “Chrissy” applied for was the Chase Sapphire Preferred Visa. Many people believe that this is the best card currently on the market and I tend to agree with them. I won’t get into details here, but it has some excellent benefits. This card didn’t exist with this offer when we did our first two churns and I got one in October, so this was the first opportunity to get one for Chrissy. Chase recently changed their advertisements to read “For a limited time only”, so if you are interested, you might want to get one in the near future. No one knows when the offer will change or what it will change to, but it would be a shame to miss out on the current offer of 50K Ultimate Rewards points with a $3000 spend in the first 3 months. I did this card first because I though it would give me the most problems. Chrissy already has 3 other Chase cards, and Chase seems to be the most strict out of the major banks in terms of number of cards, amount of total credit, and time between applications. To my surprise, a few seconds after filling out the application and submitting it, a congratulations came up on the screen explaining that she had been instantly approved. I think the last time we were instantly approved for a Chase card was in our first churn, so apparently waiting 6 months between applications did the trick.
Nothing puts me in a good mood on a churn day like instant approvals, so I moved right on to the next application. Next on the list was the Bank of Hawaii Hawaiian Airlines Card. This is also available as a Bank of America Card and people claim that you can get both cards on the same day. I was only approved for one of the two in October, so I decided to play it safe for Chrissy and only apply for one. The current offer is the same for both cards and is 35k miles for $1000 spend in 4 months. This is not a huge amount, but I have not seen or heard of a larger bonus on this card and it has a pretty easy minimum spend requirement. Also, Hawaiian miles transfer 1:2 to Hilton, so this is really a 70,000 point Hilton bonus if I would prefer. After filling out the application and submitting, I got the following screen.
This screen will only show for about 2-3 seconds and then it will reload to a page that doesn’t have the phone number on it. I remembered this from my application, so I was ready for the screen shot. What I found extra amusing was the reference number they told me to have available when I call. I think they might have a coding error somewhere in their programming. I kind of expected we would have to call for that application, so I was not too surprised when I got this message.
Early in the day I had decided to only do two cards for Chrissy because I was concerned about the high spend limits for a couple of the cards and due to a reporting error by Discover, her credit score is not as high as I would have liked. I will discuss that more in another post, but let me just say that you should read through all of the details when you get a credit report and not just look at the scores. The first two applications took a total of about 5 minutes and I wasn’t ready to stop, so I decided to take a gamble on the third card.
The card in question is the Barclays Bank US Airways MasterCard. The reason this is not a sure thing is that Chrissy already had a US Airways MasterCard from Barclays. It appears, however, that this card is churnable for the bonus and there are even reports of people having more than one of the same card at the same time. I decided to give it a try and we will see in a few weeks if it worked. The offer I used was for 40k miles with a first purchase and an additional 10k miles on the one year anniversary. I was not too surprised when after applying, I was told that they needed to review the application further and would email a decision within 10 days. This is not an acceptable time frame for me to wait, so we would need to make another call when Chrissy got home.
Once Chrissy was home from school and settled, I started making the necessary calls. The first call was to Barclay’s regarding the US Airways MasterCard. Calling 1-866-369-1283 will get you directly to a credit analyst and in my experience, a real person actually answers the phone within a couple of rings. I spoke with a very nice gentleman who quickly confirmed with Chrissy some personal information and that it was alright to speak with me. Then I handled the rest of the call, and we ended up getting an approval for the new World MasterCard and cancelling her old card. I am not sure how this will effect the bonus miles, but when she got the last card a few years ago, she had been approved for a lower level card and had only received 5k miles. For the couple points on the credit score, it was worth it to me to apply for the new card with the higher bonus and see if they allow it. You should know that when applying for a card with Barclay’s or with Bank of America, if you do not qualify for the highest tier card with the large bonus, they will automatically approve you for a lower tier card EDIT[which will sometimes come] with a significantly lower bonus. When I apply for a card with either of these two banks, I always call to confirm that the approval was for the highest tier card with the bonus that I am expecting. EDIT[Katherine reminds me in the comments that if you apply through THIS LINK for this card, you will get the 40k bonus miles if you are approved for either the Premier World MasterCard or the lower tier Platinum MasterCard.]
Our next call was to Bank of Hawaii, which is really Bank of America. I used the number that was on the screen I had captured, but of course did not have a reference number because they didn’t give me one. They were able to pull up her application, but even after she gave permission to talk to me, they insisted on talking to her directly. This was little awkward at some points because she had to ask me for things like what password and security questions I had used. They asked a whole bunch of questions about income, personal details, and why she wanted the card. Chrissy already has two other Bank of American Cards, but simply explained that we like to travel and prefer to use a card specific to the airlines that we are flying. She said that our next trip was to Hawaii and that was the reason for the card. This is not completely true, but it is important to note that you should always have a reason prepared for why you want a card. If you need to call, they will almost always ask you this question, and your chances of approval are pretty low if you just say you want the bonus miles. Finally the woman came back on the line and told her that she was approved for the card, but not before giving Chrissy a little bit of advice about her credit and how it is easy to get into credit trouble if you have too many cards.
At this point, we were now 3 for 3 and I was chatting with Chrissy and explaining that I didn’t apply for the 4th card because of the minimum spend required. She pointed out that we would have a large bill in the next couple of weeks for her tuition (she is two classes away from her second master’s degree) so we would probably be able to easily meet the requirements. Within minutes, I was back on the computer applying for the Citi Thank You Premier Visa. This card is another one of the best offers out there right now. They are offering 50k Thank You points with a $2500 spend in the first 3 months. Thank You points are not as valuable as Ultimate Rewards points since you can’t transfer them, so that along with the additional $2500 of spending is why this card originally got bumped from the churn. On the last step after the application was submitted, we were once again given a phone number to call. This time, in contrast to Bank of America, I was actually given a reference number so the call went smoothly. They confirmed and few quick pieces of information with Chrissy and then she passed the phone bank to me. After a couple of minutes on hold, the gentleman I was talking to came back and explained to me that Chrissy had reached her credit threshold with Citi and he could approve the card but would only be able to give her a $5000 limit. If we wanted, he was also willing to transfer up to $3400 of credit from one of her other cards over to this one. I decided to move some of the credit over from her Hilton Visa so she ended up with a $8400 limit on the new card. He finished up the processing and said she was all approved.
We ended up going 4 for 4 on this churn day. Any way you look at it, this is a success. There was only one instant approval and we had to make three follow-up phone calls, but her total bonus miles and points will come to 175,000 once she meets the minimum spends. That’s not too bad for a couple hours of work and the best part is, we can do it again with a whole other set of cards in as little as three months. I think I covered most of the process here, but if you have any questions about churn day specifics, feel free to ask. Hopefully this information along with your other research will help you to do your first credit card churn and give you a huge bump on your way to seeing more, spending less, and traveling the world.
This is one in a series of posts that I am doing based around the January credit card churn that we did for Chrissy. Before reading this post, I would suggest reading my previous post on What You Should Know about credit card churning, if you haven’t already. Remember that you always want to protect your credit and at least in the short term, card churning will definitely have an effect on your scores. For more information about what factors effect your credit score, check out myfico.com. Today I am going to explain a little bit about how I pick which cards to apply for. This is the process that I use and my recommendation for those starting out, but once again remember that I am not a credit professional, so take my advice accordingly.
When thinking about doing a credit card churn, the first thing you should look at is what, if any, your specific travel goals are. If you have specific travel goals, you need to look at each airline, hotel, and bank partner and decide which ones will help you reach those goals. For example, if you only like to stay at Starwood Properties, it wouldn’t make much sense for you to apply for a Hilton credit card. If your main goal is to get your family to Europe, the great sign-up bonus on the Southwest Airlines Visa card isn’t going to do you much good. That doesn’t necessarily mean that you will apply for all of the relevant cards at once, but it gives you a starting point. You should look at the available cards for each applicable partner and decide which ones have a big enough bonus to make it worth your application.
If your goal is just to travel more and you don’t have any specific trips in mind, you need to look at things a bit differently. Many people who churn credit cards fall into this category. We want to gain as many miles and points as we can, and once we have them, we start looking at the best ways to use them. If this is your goal, you will want to start out looking for the cards with the best offers and benefits out of all the cards that are currently available. It will not be as much about picking specific programs as it is about finding the highest available bonuses.
Once you have determined which set of cards you should be looking at, it is time to actually find the offers that you will be applying for. There are many places you can look for currently available credit card offers. These include airline and hotel program websites, issuing bank websites, online ads, and message boards. Most travel bloggers will also have a list of what they believe to be the best available offers. Since I am fairly new to the game, I don’t have a dedicated page up for credit cards yet, but you can see plenty of offers over at the Frugal Travel Guy, Million Mile Secrets, and many of the Boarding Area Bloggers. There are also forums at MilePoint and FlyerTalk that are dedicated to credit card offers. Many of the credit card links on blogs are affiliate links, so if you apply through those links, the blogger will receive a small commission when you are approved. If you enjoy reading a specific blog, this can be a nice way to give a little back to the blogger. You do need to be careful because sometimes the best available offers are not available through the affiliate links. As I said before, most of the blogs I mentioned will only have ads up for the best available offer, but you should always double check to make sure something better isn’t offered elsewhere.
I hope to have a dedicated credit card page up and available to you soon here at Indulge The Wanderlust. I do not have any affiliate accounts with any of the card issuing banks, so you can be sure that I will always do my best to only list the best available offers that I am aware of. In addition, whenever a really great new offer becomes available, I will be sure to share it in a post here on the blog as soon as I hear about it.
It is important to look in multiple places because as I hinted above, you are likely to find different offers available for the exact same credit card. There might be a significantly different bonus available if you click through an affiliate link rather than going right to the issuing bank’s webpage. Most bloggers try their best to only post the best public offer available. I have found that going directly to the Bank, Airline, or Hotel website will often give you an offer that has a lower bonus than you can get by applying for the same card through a different link. Sometimes, however, the best offer will only be available directly from the bank, and they won’t release it to anyone else to promote. You will never know until you check. Whenever there are different offers available, you want to click the “apply” link for the highest offer. I recommend that you also take screenshots of the offer page and any confirmation screens that show the bonus you are expecting to get. I have not had an issue with incorrect bonuses being applied, but several people have and you want to make sure you can argue your case if you have to.
Keeping all of the details of the available credit card offers straight can be a little bit confusing. I use a spreadsheet to assemble the main information for each offer and compare it to others. My spreadsheet categories include Issuing Bank, Bonus, Spend Requirement, and Annual Fee. I also usually make a note of the page where I found the link for that offer so I can go back and apply if that card ends up being one of my finalists. I browse through the available card offers on the web and anything that looks like a potential choice for me goes into the spreadsheet. Once I have compiled all of my information, I go back to the list and narrow the offers down to those that make the cut for this churn. Each time I do a churn, for myself and for my wife, I follow this process. This ensures that I am choosing the most lucrative offers available to me at that time.
When looking at your list, it is important to keep yourself from getting carried away. You will probably see all of those bonuses and want to apply for all of the cards right now. This would be a very bad idea for several reasons. First, applying for too many cards can really bring down your credit score. Second, It is unlikely that a bank will approve you for more than one new card at a time. Third, if you apply for all of the cards now, what will be left 90 days from now when you want to do another churn?
My general rule of thumb is to try to narrow my choices down to no more than one card for each main issuing bank. These banks include Chase, Citi, American Express, Barclays, Bank of America, and Capital One. Using this method, the most cards I would apply for on a single churn date is 6. Sometimes, especially with Chase or American Express, you might find more than one card that you are interested in for a single issuing bank. If this is the case, I would recommend choosing the best one and accepting that you will just have to wait a few months for the others. Applying for more at the same time will reduce the chances that you will have 100% approval, and you do not want to waste an inquiry for a card you are not approved for. Please understand that 6 is the maximum that I would recommend applying for and does not necessarily mean that you should apply for a card from each bank every time you churn. Barclays, Bank of America, and Capital One have limited credit card programs and I sometimes find that there is not a big enough offer for me to apply for one of their cards.
It is very important that you are happy with the bonus being offered before applying for a card. Most credit cards will only let you get a sign-up bonus once, so if you apply when there is a 25k mile bonus, you might end up missing out later in the year when they offer 50k or 75k. I am generally satisfied with a 50k sign-up bonus unless I know that the card in question has a history of offering higher amounts. For example, the Chase British Airways Visa offered a 100k bonus last summer and there are rumors they will repeat that offer, so I certainly wouldn’t sign up for a lower bonus offer right now, even if it was 50k. On the lower end of the spectrum, I applied for the Barclays US Airways MasterCard with a bonus of only 40k because I knew that they did not have any history of offering a larger amount. Before applying for a card, you should try to research past offers to make sure you are not losing out on potential miles or points. If you have trouble finding information about a specific card, leave a comment here and I will try to help you out.
Remember that the guidelines that I went through are just my suggestions and the process that I use. Everyone is free to make their own choices and even I sometimes deviate from what I described to you. This occurs most often with targeted offers or special limited time sign-up bonuses that will expire before my next scheduled churn.
Once you have your list of finalists, you are ready for your churn day. I usually set aside a couple of hours to do all the applications and make any follow-up calls that are necessary. I will describe the actual process for churn day in my next post, using Chrissy’s January churn as an example. Until then, if you want to get into credit card churning, spend some time researching the currently available offers. The cards that we will talk about for Chrissy’s churn will not necessarily be the best options for you since this was the third churn we did for her and she already has several of the cards that may be of interest to someone starting out.
Today we did a credit card churn for my wife, Chrissy. I plan to explain the process in detail with a couple of posts over the next few days, but I thought I should go over some general information first.
For those of you that are just getting involved with miles and points, churning credit cards is the process of signing up for multiple cards to get the often high sign-up bonuses for each card. A true credit card churn involves signing up for several new accounts, usually on the same day. People who are serious about credit card churning usually do this 3-4 times a year. In the past year, Chrissy and I have signed up and been approved for a total of 26 new credit cards and banked around 1.5 million miles and points as a result. In many cases, we are each getting one of the same card, but in a few cases, we have different cards as well.
Although the rewards can be huge, there are a few things you should know before jumping right in and applying for a bunch of credit cards. First of all, you should not even be thinking of doing this unless you have excellent credit. If you do not know your credit scores, you should definitely find out what they are before even looking at the options for card churning. There are several online services that will let you check and monitor your credit reports for a fee. I am not going to recommend a specific one here because I don’t have personal experience with any of them. I have access to Privacy Guard credit services for both myself and my wife as one of the perks for the type of checking account we have at our bank. The service doesn’t cost us anything and we can have a credit report run for each of us once a month. I always run a report the day before I do a card churn and then again a month later so I can see how my credit was effected by the churn.
Every time you apply for a credit card, an inquiry is placed on your credit report and in my experience, your score will usually drop between 2 and 8 points per inquiry. If you are planning to apply for multiple cards, it is very important to know the credit score you are starting with so you can estimate what your score will be after the churn. If your estimate is lower than you would like your credit score to be, you should not apply for as many cards. As Rick, the Frugal Travel Guy says, “Your credit is your most important asset.” Maintaining an excellent credit score is far more important that getting a few sign-up bonuses for credit cards. If you plan to buy a home or car within the next year or two, you should take a break from credit card churning and concentrate on getting your credit scores up as high as possible.
You should also only be considering churning if you do not have a problem paying off your credit card balances each month. For most of the cards, you do not get the bonus until you meet a minimum spend threshold. If you are not able to pay off the charges you made to get to that threshold, you can easily get into serious debt trouble. If you currently have unpaid credit card debt, you should work on paying that off before opening any new cards.
This type of credit card application process is known as churning because basically you are turning over your main credit cards every 90-120 days. This is usually done in bulk with several applications on the same day. Once you get the new cards, you switch most of your spending over to them in order to meet the new spend thresholds for the sign-up bonuses. I carry anywhere between 3 and 6 credit cards in my wallet at any one time. Those usually consist of a couple of my favorites that I keep for the benefits and a few that I am trying to meet spending requirements on. I would not recommend doing another churn until you have met the spend on all of your current cards. Once you have met the spend for a card, you can set that card aside and work on the next one. You do not want to cancel the cards as this will negatively effect your credit. Instead, I keep a stack of them in a file in my office and wait to negotiate when the annual fee is due. More on those negotiation tactics to come in a future post.
The reason that you want to apply for all of the cards on the same day is similar to the reason why you would want to wait 90 days between churns. Every recent inquiry on your credit report will make it less likely that you will get approved for a new card. Waiting 90 days pushes that last round of inquiries far enough away that the credit card issuers are a little less interested in them. 90 days is also a common time limit for meeting sign-up spend thresholds, so waiting this long will insure you have met the limits for most of your current cards. Applying for all of the cards in the same day will allow all of the banks to pull your credit file before any of the new inquiries are showing up on the report. If you space out the applications every few days, the inquiries will start to appear on your credit reports. You are much more likely to get approvals if you don’t have new inquiries within the past few days. Too many recent inquiries can be a warning sign for banks, so if you are planning on applying for 4 or 5 cards at the same time, you want to make sure you do the applications all at once.
I am providing you with what I consider to be the most important things to consider before deciding to do a credit card churn. I am by no means a credit expert and can not put enough emphasis on the fact that you need to make your own decisions when deciding to apply for credit. Please feel free to ask questions, but if you are not comfortable with what I have presented, make sure to consult a credit professional before moving forward with your churn.
My next post will explain how to pick the cards you want to apply for and how to find the best available offer for those cards. After that, we will get into the specifics of today’s churn for Chrissy.