Applying for Credit Cards II: The process - We Fly Free Applying for Credit Cards II: The process While I alluded to the offer for two American Airlines cards that net over 100,000 miles (100k + however much you spend to meet the terms of the offer x 1 mile each), I want to do a more generalized overview of the entire application process. I will assume, for the sake of this post, that you’ve already identified the card(s) you want. Step One: Research 1) Identify the best bonus available for the cards you’re interested in – this one is, perhaps, a bit obvious, but as you get into this game you’ll start to value the precious few cards we can apply for every year, so if you’ve committed to applying for a United card, you want to make sure you get as many miles as Chase (the bank offering the card) will give you. Soon, I will have such a list for you that has all of the best offers I know about. 2) Make sure that the cards are fairly evenly distributed between banks. If you’re unclear about what bank actually issues the card since the airline or hotel program is featured most prominently, you can usually find it in the T C at the bottom of the page where it says “this card is issued by XYZ bank of NY, NY.” The advantage of applying for several cards on the same day is that your credit reports won’t have updated with all of your new card accounts, but a single bank will be able to see if you’ve applied for three different cards they offer within an hour. As a general rule, we don’t want to apply for more than two cards per bank per cycle. It’s easy to explain to a credit analyst (see below) why you want two cards… three begins to get very difficult. 3) Ensure that you have an existing mileage/hotel account if you’re applying for a co-branded (i.e. issuer like Chase and mileage program like United) card. For some reason, things always go more smoothly if you set the cards up with an existing account vs. letting the bank create one for you. They’ll ask you for your membership number on the application. Step Two: Apply Quick Note. Take screenshots of the entire process including the bonus “splash” page that features the sign up bonus you’ll be receiving. 8 or 9 times out of 10, the correct bonus is coded into the application, but we want to have our ducks in a row in the event something falls through the cracks. If the correct bonus isn’t coded in, the customer service reps automatically assume you’ve made a mistake. But the phrase “I have screenshots of the entire process” shuts down that talk pretty quickly… For Apple computers, you will want to press “Command + Shift + 3” to take a screenshot (which will appear on the desktop). 1) Fill out the applications, taking special care to be VERY HONEST on your American Express applications. They are known to place customers under “financial review” – a much easier process (really a non-event) if you are truthful about your income on your application. Ensure that if you’re using the ***Citi two browser trick*** that you’ve actually filled out both applications in separate browsers. Hit submit and pray. 2) If you’ve been approved, congratulations! You can call and ask to have the card expedited if you’re antsy (like me). 3) If you were not approved by the computer, you’ll need to: Step Three: Reconsideration 1) Reconsideration is a bit of a misnomer. Often times, your application hasn’t actually been denied but rather forwarded along for manual review. This just means that your credit profile doesn’t meet the algorithm programmed into the computer to accept automatically. But it doesn’t mean you don’t qualify for the card! And in my experience, if you have a credit history longer than a year or so with no delinquencies or late payments, you’ll be able to talk a credit analyst into giving you the card. 2) Call the reconsideration number for the bank where you are applying for credit. Darius at Million Mile Secrets has an excellent guide available for reconsideration calls with tips and phone numbers. It’s important to realize that the numbers generally connect you directly to a credit analyst, so you’ve got to be on your game from the get-go. BE POLITE and you’ll almost definitely get the card you want. Step Four: Activation and Spend 1) Call the number on the sticker and activate the card. While you have the rep on the phone, ask him/her to verify the sign up bonus on the card. Make sure to verify the number of points/miles you’ll be getting as well as how much you have to spend (if anything) and in what time frame you have to spend it. 2) Generally speaking, if you have 90 days to complete your minimum spend, it applies from the date you were approved—NOT the date you received the card. (Yes, this is complete bullshit, but it’s the way things work). 3) If you’re having trouble completing the minimum spend in the course of your normal daily business, try to front-load by purchasing cash equivalents (like Visa or Amex gift cards) that you will spend later on. You can also try some of the tips we’ll discuss in future posts (check the blog) about how to manufacture credit card spend. Step Five. Cancellation/Retention (11 months after approval) 1) All good things must come to an end, and most of our cards will not be keepers. In general, we DO want to keep any card without an annual fee because they enhance our credit history and we do want to keep certain cards to preserve our account balances. NOTE: No matter what a bank tells you, if you’ve waited 11 months since getting the card they will NOT claw back and cancel any miles that you’ve earned and they’ve deposited in an airline or hotel program. This means that if you cancel your Citi AA cards, for example, that no matter what Citi tells you, once the miles are in your AA account, they won’t cancel them out by cancelling your credit card. You WILL forfeit any miles not yet deposited into your third party account (i.e. from spending that month). 2) The goal of calling the bank is to either A) get the annual fee waived or B) get a retention bonus that outweighs the cost of the annual fee. If we can’t do that, then we cancel the card. When we call, if they transfer you to a retention department then the game is on. These are the people authorized to make you offers to keep the card. 3) Explain to the retention specialist that you’ve found yourself not using the card as much as you thought and that you don’t want to pay the annual fee. In general, depending on how much you’ve spent on the card (and how much they value your business), they may offer you somewhere in the neighborhood of 5,000 to 15,000 points/miles. Don’t get too excited if they offer you something and don’t be sheepish about asking them if it’s the best they can do. Sound like you’re on the fence and say “hmm, that’s a tough decision but I don’t know… is that the best offer you can make?” 4) Make your decision – keep or cancel. Keeping cards, especially with Chase, is helpful for when we negotiate for other cards. Their credit analysts will generally allow you to cancel an old card to open up a new one, so keep that in mind especially with Chase.
Posted on: Mon, 15 Dec 2014 14:54:36 +0000
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