For people who are deeply into credit cards, it’s possible to go through all the high-sign-up-bonus cards in about 2 years. At that point, should you start applying for cards with lower returns? Sure, you could slow down and wait for better offers. Another option some people (churners) choose is to apply for the same card again and earn the bonus multiple times (churning). Today we’ll go over what credit card churning is and how it works.

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【6/13 Update】When you apply for an AMEX credit card now, after you fill in all your information and submit, you may see a screen telling you whether you’re eligible for the welcome bonus. There are currently two kinds of messages: 1) one says you’ve had this card before or currently still have it, so you’re not eligible for the welcome bonus (this corresponds to the once per lifetime rule); 2) the other says you’ve applied for too many credit cards recently, so you won’t receive the welcome bonus on this card. While this is more bad news for points-and-miles hobbyists, it’s also a useful warning for people who accidentally applied for the wrong card again, because it helps you avoid wasting an application and meeting the spending requirement for nothing. Also, if you choose to abandon the application after seeing the message, there will be no HP and no impact on your credit score.

Two denial message boxes from the TPG blog

What Is Churning? Why Do People Churn?

Churning mainly refers to repeatedly applying for the same credit card in order to earn the sign-up bonus and benefits multiple times.

The reason is simple: some credit cards, especially co-branded airline, hotel, and bank cards, often come with very high sign-up bonuses. For applicants, instead of applying for some other card with a lower bonus, it can make more sense to apply for the same card again and earn that high bonus one more time.

How Do You Churn?

Before you churn, the first thing to pay attention to is whether the card can actually be churned. The key question is whether reapplying will still let you earn the sign-up bonus, and under what conditions. Different banks have different policies. We already touched on this in the article “Bank-Specific Rules,” but here we’ll analyze churning again based on each issuer’s rules.

AMEX

Under the new policy, you can only receive the bonus on the same personal card once, so personal cards can no longer be churned. Business cards do not have this restriction, so they can still be churned. Since business cards are not a major focus of this blog, interested churners can google it themselves or check the relevant flyertalk forums. Cards in the same family, such as Everyday and EveryDay Preferred, do not affect each other’s sign-up bonuses.

BofA

At the moment, there is no specific anti-churning policy. As long as your application is approved and you get the card, you can receive the sign-up bonus. So the conclusion is: churn freely.

Barclays

Right now the system will automatically check whether you already have this card. If you still hold it, you won’t be approved for another one, and of course you won’t get another sign-up bonus. But if you close the card before churning, you can get approved again and receive the bonus again.

Chase

The current policy is that as long as you have not received the sign-up bonus within the past two years, you can apply again and receive the bonus again. However, if you already have the card, you cannot apply for it again. So the method is: get the sign-up bonus on a card, record the date when you received the bonus, close the card when the annual fee posts (or before reapplying), and then wait until two years after receiving the bonus before applying for the same card again.

Now, if you already received the bonus on a Chase card and then apply again within 24 months, the application will be denied outright (previously the application might have been approved, but with no bonus), HT.DOC. This is actually good news for us, because a failed churn now only costs you an HP, whereas before it could mean an HP + a new account + completing the spending requirement for nothing.

Chase has already written this new rule into the offer terms for all cards. You can check your credit card statements or your co-branded airline/hotel card account to see whether you received the bonus within the past 24 months.

Citi

Citi has limited sign-up bonus eligibility to cases where, within the past 24 months, you have neither opened nor closed a card in the same family. For example, Thankyou Preferred, Premier, and Prestige are in the same family. If you have opened or closed any one of those cards within the past 24 months, then applying for another card in that same family will not qualify for a sign-up bonus. Citi’s card families are as follows:

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Of course, under this policy, if you close a card, the 24-month clock resets. It is currently unclear whether a product change affects this 24-month calculation. If you know, feel free to leave a comment below.

This policy affects all Citi credit cards, including its own ThankYou Points cards and its co-branded airline and hotel cards.

Wells Fargo

After you are approved for a Wells Fargo credit card, whether that card is still open or already closed, if you apply again for any credit card from that bank within 16 months, you will not receive a sign-up bonus.

Which Cards Are Worth Churning?

This may sound complicated, but it’s actually simple: cards that can be churned and have high sign-up bonuses are the ones worth considering. For example, Chase CSP, UA, and some hotel and airline cards; Citi’s AA, Premier, and Prestige; Barclays Arrival; BofA Alaska; and so on. In the end, whether you should churn depends entirely on how you weigh the cost (HP, a new account, risk) against the reward (short-term sign-up bonus value). Personally, I think these cards are worth churning:

What Are the Costs of Churning?

By churning cards, we get an additional sign-up bonus. Compared with a normal application, the added HP and new account are the same. The extra risks are as follows:

  • It can affect your relationship with the bank: If the bank believes you are applying for credit cards mainly to earn multiple sign-up bonuses, it may flag you as a special customer (“pop-up jail” / blacklist risk), and you may be unable to apply for that bank’s credit cards for some period of time.
  • You may not get the sign-up bonus: Even though the banks’ policies are written clearly, you still can’t rule out accidents such as system glitches or human error such as misremembering the date. In that case, it can be difficult to fight for the bonus.
  • Your airline account might be shut down: Recently, some people’s Alaska Airlines accounts were closed after multiple sign-up bonuses posted. The real reason is still unclear, but it’s something worth watching.

Summary

Churning is one way to earn high sign-up bonuses again, but it’s not suitable for beginners. Rather than taking on all these risks, you may be better off simply applying for all the good cards currently on the market. By the time you finish, new cards and new bonuses may have appeared anyway. If you decide you really want to be a churner, please read this article and “Bank-Specific Rules” carefully, and keep up with the latest news on the major blogs so that your applications go as smoothly as possible.

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