We get at least three questions a day from people asking to clarify aspects of Chase’s 5/24 rule. In many cases, these folks understand the gist of the policy, but get lost in the details. More and more I’m realizing that this is happening because the words and terms being used to describe the rules don’t necessarily have universal or obvious definitions.
So I figured it would be helpful to go through those terms in a concrete way. If nothing else, it will give us somewhere to link back to.
And if you already know all this, and don’t want to stick around while I literally cite chapter and verse, here’s a very good puppy meeting a baby goat:
What is Chase’s 5/24 policy?
With Chase’s 5/24 policy, you typically won’t be approved for particular cards if you’ve opened five or more new accounts in the past 24 months. This is more of a general guideline than a strict rule, though.
Part of what makes it confusing is that not all cards (or all customers) are bound by this policy, but we’ll get to that in a second.
You would think that this would be as simple as adding up all your approvals over the past 24 months. Once you get to five, you win (or lose, possibly, I suppose).
The trick here, however, is that in order for approvals to count towards your five, they have to be reported. In particular, while the inquiries for non-Chase business cards will still generally show up on your personal credit report, the opening of the card may not.
American Express small business cards typically don’t report on personal credit reports, for example, so when we say they don’t “count towards” 5/24 it means that since they won’t be visible, they literally won’t be counted.
Meanwhile, if you’re an authorized user on a card, that will show up and in many cases be counted by the computer towards your five. Readers report success in explaining that the authorized user accounts are just that, and having a rep run things again.
So when you’re figuring out what your n of 24 is, here’s the math:
# of reported new accounts – authorized user accounts =
# of new approvals
Again, keep in mind that some non-Chase business cards won’t be reported in the same way, which is what makes them “not count” here. It’s not that Chase is giving special dispensations to certain competitor cards.
All of your approvals theoretically count towards your five, it’s just a matter of what shows up on the list.
Alright, so now that we’re all on the same page about what counts and doesn’t, let’s talk about what is meant by cards being “subject to 5/24.” This phrase is used to describe cards that fall under the 5/24 policy.
If a card is “subject to” 5/24, that means it is affected by, or under the control of, the 5/24 rule.
And now I’m probably going to infuriate and offend everyone (hopefully equally, though for a wide variety of reasons!) by giving you a surefire way to remember this, courtesy of the King James Version of Ephesians 5:24 (which...):
“Therefore as the church is subject unto Christ, so let the wives be to their own husbands in every thing.”
Regardless of your feelings on that particular verse (or the politics of the translation, I suppose), you’re not going to forget it now. 😉
So some Chase cards are “subject to” 5/24, and others are exempt. Most cards issued in partnership with another travel brand don’t fall under this policy, unless the co-brand partnership includes small business cards.
That’s a long way of saying that the Ultimate Rewards cards fall under 5/24, as do the United and Marriott cards, and the others don’t. Ben gave the rundown on the current 5/24 situation here.
And regardless of whether or not a Chase card is “subject to” 5/24, if you are approved for the card, it “counts towards” your future # of new approvals as per the above discussion.
Now, none of this means that you’ll automatically be declined for card that is subject to 5/24 if you’re over that limit, nor does it mean that you’ll necessarily be approved for a card that isn’t subject to 5/24 regardless of how many cards you have. Credit worthiness, recent inquiries, and all those other things still apply.
We’re just saying it’s much less likely that you’ll be approved for a card that is subject to the 5/24 rule if you have five or more new accounts that count towards that limit.
And hopefully those terms make more sense now.
Any other questions we can answer about 5/24?