Deal of the Day: 20% off flights and Points Galore

February 22, 2012 - FrugalTravelGuy

You can get 20% off JetBlue flights within the United States.

Also, don’t forget that you can get 20% off Virgin America when you use your VISA card.

You can earn up to 40,000 bonus miles from Delta by booking a cruise through them!

Million Mile Secrets is giving away 66,000 Hyatt points!

On a cautionary note, Gary over at View from the Wing has a post about his frustrating experience with JetSetter’s customer service regarding cancelled referral credits. Needless to say I will take his experience into consideration when posting deals in the future.

Here is this week’s Top 20 from Travel Zoo

HoKo

So was the 50K in CL's across all issuers or just with Chase?

@rick would you mind providing some info on the other 2 reader's situations and what ended up happening?
ace

I saw credit card apps were up 15%. Perhaps the credit card bonus days of wine and roses are over.
However, I will continue to abuse every credit card offer I can, because they can close every single account and it means nothing. I am cash flow positive. Who cares, just leave the miles.
Anonymous

WOW. What an interesting post. Thank you. I was planning on applying for a new Chase card this month, while closing a different Chase card later this year AFTER paying the yearly fee. But looks like Chase may be losing their grip on this game that they had gotten so good at. I am not dependent on free travel miles in order to complete my travel plans. And I have credit cards from other institutions.
Looks like I will have to cut back on the number of cards that I will allow Chase to issue to me.
Anonymous

I have been wondering about the level of available debt to income. As I have aaprached close to my total income – I just do not feel that I can apply for a card unless I can close several unused accounts.
Dave Op

Interesting…one question Rick, when you apply for a credit card, they usually asked "Household Income" before. Now, they just said "income". Does this mean just my income or household income? If just personal income (wife or husband), what happens to the non-working spouse?
FrugalTravelGuy

David Op: if the question was "income" out of habit I'd put household income. if it specifically said "personal income" I'd put my personal income
scwam

Having experience in this industry, it's called "excessive outstanding credit". The term may be different today. It the reason I always make sure that sum of all my lines is less than 50% of my reported income. Cards issuers always check the bureaus & look for new lines or increased limits and compare them to the income last reported with them.
Anonymous

Was it 50K total credit over 15 cards or just chase? Did the other 12 cards that are open follow a similar conservative churn cycle ie ~ every 6 months or only chase?
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Other than bring the 50K credit/70K income ratio down was there anything else they wanted to see.

I am not sure what is required by chase and perhaps that is their intention.
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Will be happy to share more detail on our 14 each open cards and total credit to income ratio of 130% each. This post is timely and may alter our behavior or approach. We have been churning over roughly same time period.

Mark
CP

Just my two cents: I have available credit card credit that is 150% of my income (not including the no-charge limits of my Amex Plat and Business Gold), and have yet to have any trouble (probably 13 or 14 cards)- so I don't think there is a magic number or cut-off you should necessarily look for.
Oblivious Asinine

This is scary!
sunk818

Point 1: Churner, right? Apply, get bonus, and move on. The applicant may have met the minimum requirements, but overall was a loss for Chase. For example, Chase Sapphire Preferred gets you the $500 bonus after $3,000 spend. At 2% interchange, the bank made $60 from the merchants. A break even for Chase would be a spend of $25,000 ($25,000 x 2% interchange = $500). I am not saying this is what happened with the writer, but this one interpretation for me. If I were Chase, I would cut my losses after a pattern can be established that this customer is not profitable.

Point 2: Income is not verified, except perhaps with AmEx and Discover. As I understand it, reported income is something they use to determine eligibility for a credit line and how much to give. If you say you make $65k, you may be denied, but if you say $165k, you may get a $15k with all other requirements being sent (e.g. low number of inquiries, on-time payment, low debt/credit ratio). I have found AmEx and Discover will sometimes ask for proof. My guess is that AmEx and Discover handle all the financial risk, while Visa & MasterCard just rent their name and technology to other banks.
Anonymous

Scary and thanks for the warning. Obviously the large credit lines had something to do with why this man was blacklisted.

1. In your opinion Rick, do you think having too many credit cards is a big red flag, even if they carry zero balance, no annual fees, and are very old?

2. Would paying the annual fees before canceling cards help avoid this situation?

3. Any advice about how to avoid this same situation? I don't have such high credit lines but do have 5 active and 2 inactive Chase cards.

Thanks!
Anonymous

This is awoken me as well. I have six credit cards as of right now. One I've had for over nine years (B of A), one I've had for two years (Chase), two I received in October (Citi), and then I got two more in January (Amex/Chase). As such, I have two cards with Chase. This post alarmed me and I recalculated how much credit I have versus what my annual income is. I have roughly $7,000 more in credit lines than my annual income. This is major concern to me.

Chase recently told me that I was pre-approved for another credit card (while signing up for a checking account). I'm pretty skeptical as to what I do next at this point.
AsherO

Did he apply for four cards total, or 16 cards total, four from each issuer?
Thomas

My question is do you get to keep the Chase reward points? I know they can't really touch airline miles, but if they take away your reward points that's truly a disaster
nsk

This part of the post is the most salient bit: "When you ask for a card you are asking for a loan. It is the lender, not the borrower that sets the rules."

We all know this is true, since we're ostensibly savvy enough to literally read the fine print when we apply for credit cards because the promotions are too attractive to forgo. So what's the problem? Why are people getting so worked up over banks exerting their rights over the cardholders?

Banks are completely in the right when they unilaterally decide not to extend credit to a borrower. Unless their contract with the borrower specifies otherwise (e.g. a long-term loan), the bank need not even give notice. This is not akin to predatory lending nor mortgage fraud.

At the end of the day, credit is – like driving – a privilege. Every savvy consumer should be able to survive should his open lines of credit be closed tomorrow. It would be inconvenient to begin writing checks for purchases, sure, but it's a very real possibility for which we should be prepared.
Andrew

While this is a word of caution, I wouldn't let it deter you from applying… Worst case is you can't get cards from Chase in the future… Most likely is that after two years you'll be fine to apply for chase again, or have to follow some of the steps to get unblacklisted that can be found in the fatwallet finance thread…
Anonymous

Why do we believe these unsubstantiated stories? Was the 750 a real score or a fake score? On all bureaus? He has 15 cards and a 50,000 CL, for an average of ~$3000 CL per card? How many recent inquiries?

In my experience when I hear something very unusual that doesn't seem right, I'm usually not hearing the whole story. That doesn't mean anyone's just lying, just maybe that they're omitting or don't understand an important detail.
Anonymous

after 2 Freedoms ( aged ones) Opened and cancelled CONtinental( jan-feb 11) one British airway( may 11) ONE Southwest ONE Hyatt ( same day in July 11) Sapphire Preferred ( Nov11,turned in BA card) I just got another long waited United Explorer. Obviously just pace out applications you should be fine. I always autopay them through checking account link and often pay down balances a few times before payment due days
I have many others cards: amex platinum+ gold premier reward blue sky citi AA ( visa amex) hilton us airways alaska air the credit score went higher after my credit card churning
Anonymous

There are a lot of details that we don't know about this individual and his credit history. Did he suffer a bankruptcy in his lifetime? Is he very young? What is his AAOA? Still though it is worrisome to me. The banks are really schizo and there is no predicting when they will target you but when they do it would really suck. i looked at my situation and my open credit is running about 110% of my income with 14 open accounts. i suspect i am on the low end compared to other very active churners. i know keeping accounts open for a year before cancelling helps our credit score a bit but maybe i need to rethink this due to the large amount of available credit i have. has anyone ever asked to have their credit line lowered with success?
AlohaDaveKennedy

Sounds like The Spanish Inquisition found another victim. The cardinals practice the dark art of heretic identification which is governed by the cardinal rule "We know a heretic when we see one." Obviously the victim is guilty and should confess. Here is our standard confession form all typed up – just have the victim sign it and we can get on with burning him at the stake.
Scottrick

@Andrew, worst case for me is that I don't get some of the great benefits from Chase cards besides the points, like my Hyatt Platinum status or EQM from my United MileagePlus Select. I've gotten much more in value from those benefits than the annual fees.
Anonymous

Did some amature churning in the past. Recently decided to get more serious. Have had a Chase SW card for 15+ years with nearly 38K CL. Recently applied for and received the Chase Shapphire and it too had 30K+ CL. Knowing I did not want to have CL trouble I called them and had them lower my Sapphire CL to 15K before I even received the card. They thought the request was odd but did it easily over the phone. Recently applied for the Chase SW Primere individual and busiess cards but had to do some explaining and CL re-allocation but got both.
Anonymous

In a former career I was a credit analyst and risk detection analyst with MBNA, 12-15 years ago range. My unit's job was to identify and assess risk of open, high credit lines in relation to total amount of open revolving lines and shut them down if the situation looked like a house of cards. It wasn't fun, but in hind sight I get what they were searching for – Houses made from cards. They were eliminating hefty risks before they got to be one. This situation sound like the account hit an algorithm Chase didn't like and risk hit the button. D/I isn't the only thing they reassess. Open to income comes up as well. Though shutting down all of his cards sounds extreme; lower lines perhaps, but shut down shouldn't happen if credit worthiness still exists. -Mike H
MileCard Insider

Interesting tactic by Anonymous…reducing credit lines ahead of the app.

Have always assumed the Southwest Visa tends to be targeted to slightly less credit worthy customers than say the Sapphire Preferred. Maybe that also set off a red flag. Just conjecture…
Thomas

Really want to know if they can keep their reward points!!

Deal of the Day: 20% off flights and Points Galore

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