Churn Question

Discussion in 'General Discussion | Credit Cards' started by PHLFlyer, Mar 10, 2013.  |  Print Topic

  1. PHLFlyer

    PHLFlyer Active Member

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    Hey everyone,

    I just recently got approved for the Barclay's USAir Premier MasterCard, with 35k miles on first use, plus a bunch of other perks at anniversary (and account opening), such as 10k miles at anniversary, companion certificate good for two $99 tickets when purchasing a round trip coach flight, 5k mile discount on booking award fares, and a free USAir Club pass. The 89 dollar fee is waived the first year, though it seems reasonable to me to keep the card (and pay the fee) given those perks I'll be getting.

    My question has to do with canceling cards though. Is there any strategy that people typically gravitate towards? For example, with this card, I think I will keep it because of the perks. But let's say I applied for a card, met the minimum spend, and then decided to cancel before the annual fee was due.

    In that case, how long after canceling a card are you allowed to apply for that same card again and receive the sign up bonus? I imagine it varies by card, but is there any general rule? If an issuer offered me points/miles that exceeded the value of the annual fee, I imagine it makes sense to take them up on that offer, true?

    Similarly, what about getting bonus miles on an airline I'm not likely to fly often (Hawaiian Airlines, for example, which I know has the BoA and BoH CC offers for 35k miles). Should I just get those bonus miles and then cancel the card at the year mark, and use the miles for award travel on partner airlines? Again, I would like to know how long before I can sign up again to receive the bonus with them.

    This got kind of long, but thanks for the help in advance. Really enjoying learning, and feel free to move this post to the Newbie forum if appropriate.
     
  2. deant
    Original Member

    deant Milepoint Guide

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    I would suggest you start by reading and researching some of the blogs. If you search, they have a lot of the information you want. As a starter, here are answers to some of your questions:

    Churning depends on the bank and specific cc. For example, Citi will allow you to churn HHonors cards every few months. However, Citi will only let you apply for 1 personal AA card about every 15-18 months. AMEX has a "dual" requirement. One is that, in the case of a personal card, you have not had the exact same card in the prior 12 months. The other is that you have not had a personal (read the T&Cs of the application for actual specifics) card in the prior 3 months. As you can see, there is no set rule.

    On cancelling. It has been said that Chase MAY claw back bonus miles if you cancel a card within 6 months. Citi and AMEX have not been known to do this.

    As for airlines you don't fly, look at where the miles can be transferred to.

    Hope this helps.
     
    curiousgeorge and PHLFlyer like this.
  3. PHLFlyer

    PHLFlyer Active Member

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    Dean, thanks for the reply. So pretty varied in terms of timelines, from as short as 3 or 4 months to as long as 18. I guess that is about what I had expected. I hadn't seen much on the blogs in regard to specifics about canceling cards or my questions. I would also never plan to cancel a card within 6 months, but would rather let the whole year elapse and try to get the fee waived, get bonus retention miles, or then cancel with a slightly longer credit history.

    And lastly, sounds good about looking at which alliance partners airlines I don't fly can be transferred to/used in. Thanks for the help.
     
  4. deant
    Original Member

    deant Milepoint Guide

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    The problem with waiting the entire year is that the "clock" does not start on some cards until you cancel. For example, Chase tends to go 2 years from date of CLOSURE. AMEX goes 1 year from date of CLOSURE. So the sooner you close an account, the sooner you can reapply.
     
  5. royce242

    royce242 Silver Member

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    Maybe I'm just too nice of a guy, but I have a bad conscious when I cancel a card only to reapply for it a few months later. I actually wait several years before I do so. Yes I know, I am not churn-worthy! But honestly, there are so many CC offers out there that I'm kept quite busy.

    I think it's up to you as far as how long to hang on to a card. My general rule is to never pay an annual fee or get a card with an AF (unless they waive it the first year). There are some exceptions though. I recently got the US Air card and got hit with the $89 in fees but felt that was worth it considering they're merging with AA and the card might not be around too much longer after the merger goes through. Also paid $40 for a AmEx Jet Blue card which, at the time, was giving away an amazing sign-up bonus.

    Other than those two instances, I usually use the card until I get the sign-up bonus and then cancel it a few months later. I always feel bad when I cancel them too (damn consciousness!), so I usually try to cancel cards when I'm in a bad mood and don't care! :)
     
  6. PHLFlyer

    PHLFlyer Active Member

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    I see what you're saying. I more meant wait a bit longer to increase the average length of credit history in regard to my credit score/report.
     

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