【16/3】Recent DPs indicate this method may no longer work because some CSRs have started refusing credit line decreases, but other DPs say it still works, so YMMV. Since we can’t test it ourselves, we don’t know the exact current situation for now. The Chase Ritz-Carlton is an excellent card and a must-apply for those interested in hotel cards and the Marriott free night package. This card regularly offers a 140,000-point welcome bonus, and it also provides $300 in airline incidental reimbursement each calendar year, meaning you can get the reimbursement twice in your first year. Of course, the annual fee is also very high at $395, and it is not waived for the first year. Unlike the airline reimbursement on the AMEX PRG and Platinum, the Chase Ritz-Carlton airline reimbursement cannot be easily cashed out through MPX, so it still hurts if you can’t quickly recoup that $395 annual fee. In this post, we’ll explain how to apply for the Chase Ritz-Carlton credit card without paying the first-year annual fee.cc-chase-ritz-carlton

How It Works

According to 15 U.S.C. § 1637, the first-year annual fee on a credit card cannot exceed 25% of the credit limit at account opening. The relevant language is below:

  • If the terms of a credit card account under an open end consumer credit plan require the payment of any fees (other than any late fee, over-the-limit fee, or fee for a payment returned for insufficient funds) by the consumer in the first year during which the account is opened in an aggregate amount in excess of 25 percent of the total amount of credit authorized under the account when the account is opened, no payment of any fees (other than any late fee, over-the-limit fee, or fee for a payment returned for insufficient funds) may be made from the credit made available under the terms of the account.

Careful readers may have already realized that if the credit limit at approval is less than $395*4=$1,580, then Chase cannot charge the first-year annual fee on this card. But the Chase Ritz-Carlton is a Visa Signature card, and the minimum credit limit is $5,000. So how could you possibly get approved for this card with an opening credit limit under $1,580? This is where a Chase loophole comes in. Although the statute refers to 25% of the credit limit at account opening, in practice, if you can get the credit limit reduced to below $1,580 after approval (we recommend lowering it to $1,500), Chase will automatically refund the annual fee that was already charged. So how do you lower the credit limit? Even though this probably doesn’t need to be said again, we still want to emphasize it here: No call. No call. No call. If you call, especially the number on the back of the Ritz-Carlton card, you will very likely be rejected immediately on the grounds that a Visa Signature card cannot have a limit below $5,000. The trick here is to send a secured message. When sending the message, avoid mentioning the card name, and refer to the card by its last four digits instead. For example:

“Please move $X,XXX of credit limit from my credit card ending in 1234 to my credit card ending in 5678.”

If all goes as expected, you should soon receive the refunded first-year annual fee. There are also DPs reporting that the Ritz-Carlton card still retains its Visa Signature benefits even after the credit limit is reduced.

Summary

The Chase Ritz-Carlton is already a great card, and this way of applying without paying the annual fee makes it even more of a must-have. That said, there are a few important points readers should keep in mind:

  • 15 U.S.C. § 1637 only mentions the first-year annual fee. At present, there are no reports of the second-year annual fee being refunded as well, so it’s probably safest to cancel the card before the second annual fee posts.
  • The Chase United MileagePlus Club card is very similar to the Chase Ritz-Carlton, but targeted no-first-year-annual-fee offers for the UA Club are very easy to find. If you don’t know how to find one, click the link above and refer to our article on that card. If you can’t find the offer and really want to try the UA Club, you can also follow the method in this post. In addition, applying for the Chase UA Club through a link with the annual fee can also get you an extra $100 welcome bonus.
  • There have been no DPs reporting that this bug also works on cards from other banks. So for now, it does not appear possible to use the same method to apply for high-annual-fee cards such as Citi Prestige or Citi AA Executive.
  • We strongly do not recommend using this trick on low-annual-fee Chase cards.
  • One last reminder: No Call is the number-one rule. If the annual fee is not refunded automatically, do not proactively call Chase and argue with a CSR about it.

Do you know of any similar tricks? Feel free to leave a comment and share it with us.