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TPG reader Frank asks:
“I have five Chase cards: Amazon, Priority Club, Hyatt, Sapphire Preferred and Freedom. I wanted to see if you know if there is a limit to how many Chase cards one person can have? I do not use the Amazon card but I have not canceled it since it does not have a yearly fee. I am looking to apply for the Southwest card and/or the Fairmont card but do not want a credit pull if there is a limit on the number of Chase cards that I can have. I use the Freedom and Sapphire Preferred religiously and keep the Priority Club and Hyatt for the free yearly night. Please help.”
One of the great things about Chase and the variety of points-earning cards it fields is that basically there’s no known limit to the number of Chase credit cards you have. It really boils down to the amount of credit that Chase will extend you. They set a total credit exposure for each customer, so they may calculate that based on your income, credit history and relationship with the bank that they’ll extend you $40,000 in credit. You can then divide that credit up into numerous smaller lines to keep opening cards. At what point will Chase say no more cards? There’s no solid answer, but it helps to be a profitable customer, so I’d recommend building a solid relationship with Chase and think about using their other financial products like checking accounts and car loans (if they make sense for you financially).
In the case of a decline for your next card, Chase tends to be very good about either letting you split your line of credit from an existing card in order to open a new one, or letting you close one credit card account to open another. So, say you have the Hyatt card that you’re not using much and want the Fairmont one as you mention. If you get declined for the new card, you can call the reconsideration line and ask if it would make a difference to transfer your credit line to the new Fairmont card, or split your credit on your old card into two lines of credit and get the new card. You can even try explaining that your future travel plans involve stays at Fairmont so you wanted to try their program out and test out the new Chase Fairmont Rewards points. Just remain calm, concise and reasonable, and it should work out.
All that being said, always take your credit score into consideration. FICO says “opening several credit accounts in a short period of time represents greater credit risk.” That’s because you’re applying for multiple lines of new credit rather than submitting several inquiries for a single new line, such as a mortgage. Generally new credit inquiries only cause your score to dip 2-5 points in the short term (this FICO page shows how your credit score is calculated). In general, the impact on your score from multiple inquiries is small—and remember that new credit counts only 10% toward determining your overall FICO score. So as long as you are strong in the other areas like payment history and amounts owed, you should be fine to apply for new cards and keep reaping those lucrative travel rewards.
I personally have four current personal cards (Sapphire Preferred, Freedom, Hyatt and British Airways) and two Ink Bold business cards (the old one that is no longer offered that had Chase Exclusives program and the new one). I have been initially declined for several of these cards, but was always able to get approved by calling the reconsideration line and moving around lines of credit. I’ve also been able to get approved for a personal and business card on the same day, which is great because it only counts as one credit inquiry.