Are rewards card sign-up bonuses just for new customers?
When getting a new card with the same issuer, you may not reap the rewards
By Cathleen McCarthy
Cathleen McCarthy is a journalist whose articles on travel, commerce and consumer topics have appeared in dozens of publications. She writes "Cashing In," a weekly column about credit card rewards programs, for CreditCards.com
Ask a question.
'Cashing In' archive
Dear Cashing In,
have a Chase Sapphire non-preferred card with 29,000 points accumulated. If I
cancel this card, will I lose all my points? My intention is to sign up for the
Chase Sapphire preferred card that has a 50K point bonus. Thank you for your
time. -- Jonh Upton
I don't blame you for wanting to get in
on that deal. The Chase Sapphire Preferred card offers a lot of perks,
including 1-to-1 point transfers for several airlines, hotel chains and
Amtrak; two points for every dollar spent on dining and travel; and an annual 7
percent bonus on points earned. Add to that the aforementioned 50,000-point sign-up bonus (after $3,000 spent in the first three months) and you have a very
Unfortunately, as a current Chase
Sapphire cardholder, you are not in a strong position to jump on this deal. If
you're hoping to end up with 79,000 points total and a better credit card, your
chances are slim -- but not none.
To answer your first question: Yes, if
you cancel your nonpreferred card, you lose the points associated with that
account. Doing that and then applying for a new card would also ding your
credit. Whether that ding would be enough in itself to disqualify you
for the preferred card depends on your credit record as a whole.
If your credit is excellent, Chase may overlook
that bit of recent history. If it's less than stellar, there's a good chance
you won't qualify for the preferred card -- this is a popular card right now. That would mean that you'd be out both a credit card and 29,000 reward points, which would be the worst-case
More important, you will no longer be
a Chase cardholder when you apply for the Sapphire Preferred card. So you're
not only stripped of the 29,000 points you had in your pocket, you're also
applying as a "new customer," which potentially qualifies you for the 50,000
sign-up points but strips you of the power you wielded as a current customer.
The official line from Chase is that if
you apply for a Sapphire card while holding onto another, the best you can hope
for is a trade-up on your existing account. They may upgrade you to preferred
status, but you would have to forfeit the 50,000 sign-up points. That bonus is
designed to lure new customers, after all. You are already a Chase Sapphire
cardholder. If they upgrade you to Preferred, you protect your credit rating
and end up with a better credit card, but you wind up with the same number of points you currently have: 29,000.
However, Chase has been known to make
exceptions to that rule. It's definitely worth asking. Your best bet is to call
the number on the back of your current Sapphire card and try to negotiate. Ask not
only to upgrade to Preferred, but also see if you could get the 50,000 bonus points you would be
allotted if you were not an existing customer. Whether or not they agree may
depend on how loyal and profitable a customer you've been up to this point.
Like any other business, Chase doesn't
want to just attract new customers, it wants to hold on to the ones it already has -- especially those who have proven themselves valuable. Most
things are more negotiable than people realize, from the published price of
hotel rooms to partial refunds on clothing purchased before a sale. In other
words, you have an ace in your hand right now as a loyal customer and it's
worth playing, even if what you're asking defies official rules.
See related: Rewards card sign-up bonuses get more generous
Meet CreditCards.com's reader Q&A experts
Vexed by a personal finance problem? CreditCards.com's Q&A experts answer questions from readers every weekday. Ask a question, or click on any expert to see their previous answers.
Published: November 26, 2011
If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.
Did you like this story? Then sign up for CreditCards.com’s weekly e-newsletter for the latest news, advice, articles and tips. It's FREE. Once a week you will receive the top credit card industry news in your inbox. Sign up now!