Banks like people who make them money. This primarily includes those who carry a balance on their credit cards. As a travel hacker, you know you can’t get good value if you carry a balance on your cards from month to month. Carrying a balance would negate the cost of your points, and may even cause you to lose money! Since you aren’t going to do this, you aren’t making the banks money. Banks don’t want to lose money, so they impose rules to try to limit credit card churning behavior. Chase’s rule is very restrictive – and it is known as the 5/24 rule. This post will explain the Chase 5/24 rule, the impact it can have on travel hackers, and show why new travel hackers should always start with Chase cards first!
Chase 5/24 Rule Explained
The Chase 5/24 rule comes up in travel hacking a lot. It is Chase’s way to exclude you from getting too many sign up bonuses. The Chase 5/24 rule states that Chase will NOT approve you for a new credit card if you have opened 5 new credit card accounts in the past 24 months. This is not limited to Chase products only. It includes all credit card issuers – such as American Express, Citi, and Wells Fargo.
It is important to note that this rule only applies to new accounts opened. If you were denied for an account it does not count against you. The rule also includes authorized user accounts, since they show up on your credit report. Generally, you can get around this by calling into the Chase Reconsideration Line and explaining that those accounts are authorized users, but it is not guaranteed.
The Chase 5/24 rule does NOT apply to all Chase cards. Though some exceptions may exist, the general rule is that it applies to all Chase branded cards, OR a partner card that also has a business version.
Impact on Travel Hackers
The Chase 5/24 rule has a significant impact on travel hackers. If you don’t start with Chase cards you could be excluding yourself from many lucrative sign on bonuses and earning opportunities. I’m a huge fan of Chase Ultimate Rewards, and all Ultimate Rewards earning cards are subject to the Chase 5/24 rule! This is why it is important to start with Chase, and why my beginner’s guide recommends Chase cards to get your first Hawaii trip.
There are many cards included in the Chase 5/24 rule that you may be excluded from receiving. The list includes the following cards:
Southwest Plus personal card
Southwest Premier personal card
Southwest Premier business card
Marriott Premier personal card
United MileagePlus Club Card
United MileagePlus Explorer personal card
United MileagePlus Explorer business card
Not all hope is lost, however. There are some cards that don’t fall under the Chase 5/24 rule. I received an approval for the Chase Ritz-Carlton card when I had 17 new accounts in the past 24 months! The following cards are excluded from the Chase 5/24 rule, but remember, your mileage may vary:
Marriott Premier business card
Getting Around the Chase 5/24 Rule
Not all hope is lost. There are some ways around the Chase 5/24 rule. This allowed many experienced travel hackers to receive the lucrative Chase Sapphire Reserve when it was released in 2016. Keep in mind, these will not prevent you from triggering the 5/24 rule, but only apply if you are already past it.
You can check online for Pre-approvals. If you are pre-approved for a card you may get around the Chase 5/24 rule.
In Branch Offers
Visiting a branch to check for offers is a great way to get around the Chase 5/24 rule. However, it is not as simple as going into a Chase branch and asking a banker to see what you are offered. Most people who use in branch offers were told they were pre-approved without prompting the banker. You may need to use some sly wording, such as “I was nearby and wanted to stop by to explore any available options.” But if you specifically ask they are likely just using the same online checker you can use from home.
Many people consider this “junk mail.” But to a travel hacker, targeted offers can provide great value. Although Chase doesn’t send as many as Citi and American Express are known for, if you get mail with an invite code it may also bypass the 5/24 rule.
Avoiding the Chase 5/24 Rule
Every experienced travel hacker has fallen victim to the 5/24 rule and can no longer get many valuable Chase cards. Some may want to be able to get Chase cards again. The reasons can vary, but often it is to receive the Southwest Companion Pass which can be gotten via two Chase cards.
The only way to avoid the rule and be re-eligible is patience. But you don’t have to stop travel hacking during that time. Many business cards do not show up on your personal credit report. This means you can continue travel hacking with business cards while waiting to be under 5/24 again! As always, your results may vary. But if you are waiting to be under 5/24, seek business cards to continue earning lucrative sign on bonuses.
If you are new to travel hacking, I highly suggest starting with Chase cards to get maximum value out of Ultimate Rewards earning cards before falling victim to the Chase 5/24 rule. If you are past 5/24, then consider some of the Chase cards that aren’t subject to the rule. And if you have the patience, you can travel hack with business cards until you are able to open cards subject to the rule again.