A little over 6 month ago Chase began imposing a new rule on credit card applications that require a customer to have no more than 5 newly opened accounts on their credit report within the last 24 months. This has become known as the “Chase 5/24 rule.” Hence, if you are planning to apply for a Chase Ultimate Rewards branded credit card like the Chase Sapphire Preferred and you have more than 5 newly opened credit card accounts on your credit report within the last two years, your application is likely to be denied. In this instance I would wait until accounts drop off the 24 month window, or I would try to avoid the Chase 5/24 rule by considering co-branded credit cards offered by Chase like the Hyatt, IHG, or United cards, or possibly even the Chase Ink Plus business card.
Of course there are many exceptions and inconsistencies with how the rule is actually being implemented, so I wanted to take a moment to summarize what I know about the policy so far.
Exceptions to The Chase 5/24 Rule
- Applications for business cards are not subject to the rule (for instance the Chase Ink Plus or Chase Ink Cash cards are exempted)
- You can likely avoid this rule by applying at a Chase bank branch
- If you were targeted for a pre-approved credit card sign up offer, you are likely not subject to this rule
- This does not apply to applications for co-branded credit cards (e.g. Hyatt Gold Passport Visa, United Airlines Visa, etc.)
- Some people have reported that newly opened accounts within the last month are not appearing on their credit report because a first bill must be issued before the account appears
- New business card accounts do not count toward the 5 new account limit because business cards do not show up on your credit report
What Triggers The Chase 5/24 Rule?
- It sounds like adding an authorized user to your account counts toward the 5/24 rule
- There are reports that calling the reconsideration line before your application has been fully routed through Chase’s system can result in a denial. This may not be due to the 5/24 rule, but other factors, but nonetheless you should avoid calling the reconsideration phone line for now until there is more clarity around this issue. If you are denied due to the 5/24 rule, then it may be helpful to call the Chase reconsideration line at (888) 245-0625 and ask the representative why you were denied and if there is anything else you can do like providing more information that may reverse their decision.
Bottom Line
If you are planning to apply for a Chase personal credit card make sure you check the number of open accounts you have over the last two years. It would be a shame to waste a hard pull on your credit only to get a denial that could have been avoided with a bit of homework upfront. In addition, Chase may be looking at extending this rule to co-branded cards and business cards soon. I would highly consider applying for the Chase Ink Plus card if you don’t already have it because it could soon become much harder to get approved for this card judging by Chases new policy.