In the world of of what seems like endless credit cards available for travelers, Chase’s 5/24 rule is a crucial piece of knowledge that everyone needs to be well acquainted with. This rule significantly impacts your ability to be approved for certain Chase credit cards. Whether you’re a brand new to using credit card points for travel or been doing it for years, understanding the 5/24 rule can be key for long term success.
What is the Chase 5/24 Rule? What does it have to do with the 24th of May?
No, it’s not a new holiday in May, the Chase 5/24 rule is a guideline that Chase uses to determine eligibility for their credit cards. Specifically, it means that if you have opened five or more personal credit cards (from any bank group) within the past 24 months, Chase is likely to deny your application for most of their cards. This rule applies to a wide range of Chase credit cards, including popular ones like the Chase Sapphire Preferred, Chase Sapphire Reserve, and many of their co-branded cards (think cards like United, Marriott, Southwest).
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What Counts Toward the 5/24 Limit?
1. Personal Credit Cards: Any personal credit card account opened in the last 24 months counts toward the limit. This isn’t just Chase, but also Capital One, Amex, etc. Even if you have closed a card after a year, this will still count towards the count.
2. Authorized User Accounts: Accounts where you are an authorized user may also count, although you can sometimes explain your status to a Chase representative to potentially exclude these from the count.
3. Co branded Cards: These are cards that can only be used at a specific hotel, airline, store. Hyatt, Marriott, Southwest, Disney Visa to name just a few. All these will count towards Chase’s 5/24 rule.
What Doesn’t Count?
1. Prepaid Cards and Debit Cards: These do not count towards the 5/24 limit as they are not credit accounts.
3. Business Credit Cards: Business credit cards from most issuers (except Capital One and Discover) generally do not count towards your 5/24 limit.
3. Student Loans, Car Loans, and Mortgages: These types of credit do not count towards the 5/24 rule, but can impact your ability to be approved for a new card.
What Cards do we suggest closing and getting again
Chase Sapphire- you can downgrade this card to a Freedom card after 48 months and reapply to get a new sign up bonus.
Chase Southwest co branded cards (so you can get companion pass multiple times)- close this card after 24 months.
Chase Marriott and Hyatt cards (if a huge elevated offer comes up), but we tend to keep these open most of the time, as the annual fee is low.
After closing a card, make sure to wait a month before reapplying.
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Strategies to Navigate the 5/24 Rule
1. Prioritize Chase Applications: If you’re planning to open new credit card accounts and are close to your 5/24 limit, prioritize Chase credit cards first. 2. Don’t add a spouse as a authorized user; If they are an authorized user on your account, this will add to their 5/24 and can make it so they can’t apply for as many cards for travel. 3. Check Your Status: We highly recommend Travel Freely (you can sign up here) to keep track, and they will automatically notify you when you can apply for a new card, or when you could close/downgrade a card and reapply. 4. Consider Business Cards: If you have a small business or a side hustle, applying for business credit cards can help you access more points without affecting your 5/24 count. We try to keep our Card count to 4/24 and then apply for business cards instead of personal.
Exceptions and Workarounds
While the 5/24 rule is generally strict, but if you are denied due to the 5/24 rule, you can call the Chase reconsideration line. Sometimes, explaining your situation might lead to an exception.
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