Chase is known for having the 5/24 rule, which impacts your ability to be approved for their cards. However, this also seems to cause quite a bit of confusion, especially when applying for business cards. So I wanted to explain what you need to know in that regard.
The industry-leading Chase Ink business cards
Chase has three excellent business credit cards in their “Ink” portfolio, which are complements to one another:
- The Ink Business Preferred® Credit Card has a $95 annual fee and offers 100,000 Ultimate Rewards points after spending $15,000 within three months; the card offers 3x points in select categories
- The Ink Business Cash℠ Credit Card has no annual fee and offers 50,000 points after spending $3,000 within three months; the card offers 5x points in select categories
- The Ink Business Unlimited℠ Credit Card has no annual fee and offers 50,000 points after spending $3,000 within three months; the card offers 1.5x points on all purchases
All three of these cards are excellent, and I view them as complements rather than substitutes. Cardmembers can potentially get all three of these cards, for a total of 200,000 bonus points, not to mention a great portfolio of cards to use long term to maximize their small business spend.
One common point of confusion with these cards is how Chase’s 5/24 rule works in relation to these cards, as that will impact the odds of being approved for many people. So I wanted to address that in this post.
The basics of Chase’s 5/24 rule
Chase’s 5/24 rule is one of the many policies that Chase has in place when deciding whether or not to approve someone for a credit card. With this policy, Chase typically won’t approve you for a new card if you’ve opened five or more new card accounts in the past 24 months.
In general, it’s important to understand that:
- A majority of new credit card accounts will count towards that limit, meaning that opening five or more cards in 24 months will make you ineligible for certain Chase cards
- One exception is most business cards, including those issued by American Express, Bank of America, Barclays, Chase, and Citi, generally won’t count as an additional card towards that limit, because they won’t be shown on your personal credit report
Does the 5/24 rule apply to Chase business cards?
This brings us to a common point of confusion. Are the Ink Business Preferred, Ink Business Unlimited, and Ink Business Cash subjected to the 5/24 rule or not?
Yes, Chase Ink cards are subjected to 5/24, meaning that you can’t be approved for them if five or more new card accounts show on your personal credit report in the past 24 months.
However, when you do apply for a Chase business card, it won’t count as an additional card towards that limit. In other words, if you’ve opened four new accounts in the past 24 months and then apply for a Chase business card, you’ll still be at four cards. If you then apply for another Chase business card, you’ll still be at four cards.
Why? Because both of these are business cards that don’t show up on your personal report for these purposes.
A real-life example
Let me give a real-life example that I faced last year. I was at 4/24, meaning that I was eligible for Chase cards once again. But I could only have one more card on my personal credit score before I was once again above the limit.
I wanted to get the Ink Business Preferred, Ink Business Unlimited, and the World Of Hyatt Credit Card, all issued by Chase. If I had applied for the Hyatt credit card first, I would have been at the limit again, since it’s a personal card that shows up on my personal credit. So what I did instead is:
- Apply for the Ink Business Preferred; since this is a business card issued by Chase, it didn’t show on my personal report, and I was still at 4/24
- After waiting for about 30 days I applied for the Ink Business Unlimited; since this is a business card issued by Chase, it didn’t show on my personal report, and I was still at 4/24
- Apply for the World of Hyatt Card, which put me at the 5/24 limit, since it’s a personal card that shows on my report
I know this is complicated, but hopefully, this helps clear things up. Yes, Chase Ink Business Cards are subjected to 5/24, meaning you can’t be approved if five or more new cards show on your personal credit in the past 24 months.
However, actually applying for a Chase Ink Business Card typically won’t show on your personal credit report, and therefore wouldn’t count as a further card towards that limit.
In other words, always apply for business cards before personal cards if you’re trying to stay under the 5/24 limit. With some patience, it should be possible to get approved for the Ink Business Preferred, Ink Business Cash, and Ink Business Unlimited.