Expert Q&A

How to avoid credit card sign-up bonus bait and switch


Just because a card company invites you to apply for a card and approves your application does not necessarily mean it will give you the sign-up bonus that comes with the offer.

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The Fine Print with Fred Williams

Fred O. Williams is senior reporter for A business journalist since 1987, his work has appeared in Kiplinger’s Personal Finance magazine, the Buffalo News and USA Today.

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Can a bank deny you a sign-up bonus after soliciting and approving your application?

Offer terms give issuers wide latitude to deny bonuses to repeat applicants, but there are ways to minimize the danger.

Expert Q&A

Check out all the answers from our credit card experts.

Say a bank entices you to apply for its credit card with a big sign-up bonus of points or miles, even cash back.

You apply, are accepted and make the spending requirement before the deadline.

But when you go to claim the bonus, you are told you are not eligible. The reason? You’ve had a card from the bank sometime in the past.

Just because a card company invites you to apply and approves your application, that does not guarantee you will get the sign-up bonus touted in large print.

As generous welcome offers proliferate, complaints are mounting from consumers who were rejected for bonuses under card issuers’ policies.

See related: Rewards cards draw a surge of complaints

Unwelcome bonus

After receiving an offer for an airline card from Citi, an Indiana consumer applied and was approved for the card, made the qualifying purchases, then went to book a trip thinking he’d use his bonus. No dice.

“I did not receive the bonus miles as they have a policy of not rewarding cardholders who opened or closed an account within 24 months,” the unnamed consumer wrote in a complaint to the U.S. Consumer Financial Protection Bureau. “I applied for the card based upon their offer specifically to me,” he wrote.

A holder of an American Express Platinum® Card in New Jersey said her bonus points were denied for having had an AmEx card in the past. “I got the offer mailed to my house with my name on it with an offer code,” she wrote. “Now they say you don`t qualify?”

Both complaints were closed without a refund, CFPB records show. Several other consumer complaints tell similar stories. In some cases, they said they had paid an annual fee before finding out they were ineligible for the sign-up bonus.


Tip to avoid bonus denial: If you have previously had a card from the issuer, or currently have a different card from that issuer, this is what you can do:

  • Call the company to confirm your bonus eligibility.
  • Document the offer you are applying for. Keep a copy of the offer materials or take screen shots if online.
  • Check your rewards balance after meeting the spending requirement to make sure the bonus was awarded.


Offer language gives consumers little protection

There is little recourse for a cardholder in this position, legal experts said. Card issuer terms and conditions make sign-up bonuses more of a vague possibility than a solid promise.

This disclaimer from American Express appears in the small print of several offers, including the Premier Rewards Gold Card from American Express:

Welcome offer not available to applicants who have or have had this Card. We may also consider the number of American Express Cards you have opened and closed as well as other factors in making a decision on your welcome offer eligibility.”

“That’s fairly ambiguous language,” said Stuart Rossman, director of litigation at the National Consumer Law Center. The wording gives AmEx a broad loophole and makes it difficult for an applicant to determine their eligibility.

At Capital One, this disclaimer appears in a footnote for the Capital One Venture Rewards Credit Card offer on Capital One’s website, which carries a welcome bonus of 50,000 bonus miles after $3,000 of purchases within the first three months: “The bonus may not be available for existing or previous account holders.”

Chase’s Southwest Rapid Rewards program terms says it may revoke your points if  “we believe that you’ve misused this program in any way, for example by repeatedly opening or otherwise maintaining credit card accounts for the purpose of generating rewards.”

But does the legalese justify denying the bonus after enticing the consumer with a solicitation touting?

Those circumstances could amount to a violation of consumer protection law that forbids unfair practices, Rossman said.

However, there’s a legal roadblock in the card terms and conditions: Several of the large card issuers, including Citi and American Express, require disputes to be taken to arbitration instead of court. The mandatory arbitration clauses forbid cardholders from banding together in a class action.

“As a practical matter, that is not a viable way to enforce your rights,” Rossman said of individual arbitration.

How to guard against bonus denial

One way to circumvent that happening to you is to call the issuer before applying to verify your bonus eligibility, especially if you already have a different card from the bank.

However, some complaints indicate customer service representatives have provided unreliable information about bonus eligibility.

In one potential solution, American Express has started screening applicants during the online process, according to The Points Guy. One online applicant for the company’s Platinum Card said he received a message saying he was not eligible for the welcome offer, before the credit check was launched. The pop-up asked if he wanted to continue with the application or not.

What about other card issuers?

A Citi representative confirmed that applicants are ineligible for offers if they’ve had another Citi card in the past 24 months – as the cardholder in Indiana found out the hard way.

At Chase, the company is known to reject applications from consumers who have applied for several cards in a recent time span. Known as the 5/24 rule, the policy of rejecting applications is actually a protection against being baited with an unavailable sign-up bonus.

But Chase cardholders are not exempt from bonus difficulties. One holder of a travel card was told he signed up for a bonus worth fewer points than he had been led to expect. “The account specialist said unless I had screenshots of the sign-up page from the time I signed up \u2026 there’s nothing to be done.”

The complaint was closed without a refund.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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