The Ultimate Guide To Credit Card Application Rules, Exceptions, and Restrictions

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The Ultimate Guide To Credit Card Application Rules, Exceptions, and Restrictions

Do not submit your next rewards credit card or cash back card application until you’ve read this ultimate guide on credit card application rules, exceptions, and restrictions. Banks have implemented many sign-up bonuses restrictions in the last few years. These new rules make it tougher than ever for people to get approved for rewards credit cards and receive sign-up bonuses. By reading this guide, you’ll know each bank’s rules and how they apply to your situation.

This article will cover

Credit Card Application Rules Vary By Bank

How long does it take to get approved for a credit card? For most people, if you qualify for the credit card you’ve applied for, you will be approved instantly. People who are borderline or run afoul of the bank’s credit card application rules will be declined or have their application go to a pending status.

Banks are cracking down on rewards credit card applications because so many people are “churning” personal and business credit cards just to earn the sign-up bonuses. Churning is the strategy of signing up for a credit card purely for the sign-up bonus, then canceling the credit card before the next annual fee is due.

Because sign-up bonuses are so lucrative, the activity of churning affects the bank’s bottom line. Each bank has started to introduce welcome bonus restrictions to limit this behavior.

The credit card application rules do vary by bank. And some signup bonus restrictions vary by which credit card you are applying for. Do not waste a credit inquiry by applying for a rewards credit card that you are not eligible to get approved or to receive the sign-up bonus.

We are going to walk through the major banks and share what you need to know before submitting your application.

 Maximum Number of Cards AllowedCredit Card Application FrequencyReceive New Cardmember Bonus More Than Once?Waiting Period Between New Cardmember Bonuses
American Express4x credit cards and 1 of each charge cardMax 2x credit cards per day (e.g. 1x business + 1x personal), no known limit for charge cardsNoOne welcome bonus per card, per lifetime
Bank of AmericaMajority of cardholders allowed maximum 4x cards2 new Bank of America cards in any 2 months period.
3 new Bank of America cards in any 12 months period.
4 new Bank of America cards in any 24 months period
YesOnce every 90 days. 2/3/4 rule
BarclaysNo set limit but no more than one of each card1 card per 6 months and only 1 card at a timeYesNo set policy. If reapplying for same card, must cancel card and wait 6 months before reapplying
Capital OneMax 2x cards per card family (e.g. 2x Capital One branded cards)1 personal or 1 business card per 6 monthsYesNo waiting period outside of application frequency
ChaseNo card limit. Limit on total line of credit across all cardsAll UR earning cards and most (if not all) co-brand cards subject to 5/24. 1 personal + 1 business card per 90 daysYes24 months after last receiving bonus and not a current cardholder
CitibankNo card limit. Limit on total line of credit across all cardsMax 1 personal card per 8 days + 2x total cards per 65 days. Max 1 business card per 95 daysYesCan receive signup bonus if you haven't opened OR closed card in previous 24 months. One signup bonus per card family per 24 months
Discovermaximum 2x cards allowed1 new Discover card within 1 year of getting the first card.
Only 1 student card can be opened additionally
YesNo waiting period outside of application frequency
Wells FargoNo card limit. Limit on total line of credit across all cards1 card per 6 months and only 1 card at a timeYesEligible for one Wells Fargo introductory offer every 15 months

Capital One Credit Card Application Rules

Capital One Credit Card Application

Capital One has been really popular lately with the launch of several new and upgraded rewards credit cards and cash back cards. The Capital One Savor is excellent cash back card with its unlimited 4% cashback for people who spend a lot on dining and entertainment. And the Capital One Venture Card recently announced the ability to transfer points to airlines, which greatly increased the value of those points. I expect Capital One to continue to revamp their product line this year, so keep a close eye on them.

Maximum Number of Cards

The Capital One credit card application rules are the most restrictive of the major banks when it comes to the number of their credit cards that they allow open at one time. Cardholders are allowed to have a maximum of two Capital One personal credit cards open at one time. Small business credit cards and co-branded credit cards are excluded from this limit.

This means that you can have two personal credit cards from Capital One plus at least one small business credit card. The Spark Cash from Capital One is a great cash back card option with its current $2,000 sign-up bonus offer.

Number and Timing of Applications

Applicants can only get approved for one new Capital One credit card every six months. This limit includes both personal and small business credit cards. If you took advantage of the Capital One Venture Card 50,000 point bonus offer like I did, then you’ll need to wait six months before applying for the Capital One Savor or Spark Cash from Capital One.

The good news is that Capital One has a limited number of credit cards that you can apply for. So this six-month rule is not too prohibitive when it comes to welcome bonus restrictions. It actually helps to spread out your applications and mix in with credit cards from other banks.

Welcome Bonuses

When you submit a Capital One credit card application, the terms and conditions allowing the bank to limit bonuses. However, most applicants that I’ve talked to report being able to receive Capital One sign-up bonuses multiple times.

Because Capital One has a limited number of credit cards, this is a good approach by the bank otherwise they would shut out many customers from returning.

American Express Credit Card Application Rules

American Express Credit Card application

American Express was one of the first major banks to implement restrictive rules. The bank has lost several of its premier co-branded rewards credit cards in recent years. But they have started to rebuild their portfolio of personal and business cards. They took over 100% of the Hilton Honors credit cards from Citibank in January 2018, then launched premium versions of the credit cards soon thereafter. Then Amex retained a relationship with Marriott that could have been swallowed by Chase when SPG was acquired.

Maximum Number of Cards

With American Express cardholders are limited to a maximum of four credit cards. This limit is a combination of personal and small business credit cards. However, Amex also offers charge cards, such as the American Express Platinum, which do not count against this limit. I have not seen any limitations to the number of charge cards that someone can have.

Amex also does a lot of business with major corporations. If you have corporate cards from work, those corporate credit cards do not count against your limit of four credit cards.

Number and Timing of Applications

Applications are restricted to two new credit cards every 90 days. That includes charge card applications.

You can apply for two American Express cards in a single day, but you should vary the type of card that you are applying for. For instance, you can apply for one Amex personal credit card and one business card or one personal credit card and one charge card.

The American Express Gold Card is a charge card that has some popular new benefits, like 4x on dining and grocery stores. You can sign up for the Gold Card on the same day as the new American Express SPG Luxury Card that offers $300 in annual credits at Marriott hotels and resorts.

Welcome Bonuses

One of the first signup bonus restrictions in credit card bonuses was the American Express “once per lifetime” rule. This rule prohibits an application from receiving the bonus from a rewards credit card if they have ever received the bonus before. Applicants who’ve had the bonus before can get approved for the card, but will not receive the bonus. If it has been more than seven years since you’ve received a welcome bonus on that specific credit card, there’s a good chance that you can earn it again.

In the summer of 2018, people applying for American Express cards online were greeted with a qualification tool warning. The tool would warn applicants that they’ve already received the bonus and would not earn it again if they proceeded with their application. I’m glad that American Express instituted this warning system before they placed a credit inquiry on someone’s credit report.

I’ve seen friends apply for Amex cards that did not have the “once per lifetime” language on the application. Even though they received the bonus in the past, they were able to receive the bonus again.

Another way around this American Express credit card application rule is to upgrade from a card within the same family. For example, American Express may offer a bonus to upgrade from the no annual fee Hilton Honors Card to the $95 annual fee Hilton Honors American Express Ascend Card. Even if you’ve had the Ascend Card before, you can still receive an upgrade bonus when eligible.

For more information, read this article – American Express Application Rules: Will You Get a Sign-Up Bonus?

Chase Credit Card Application Rules

Chase Credit Card Application

Chase has curated the most attractive portfolio of rewards credit cards over the last decade. And their personal and business cards that earn Chase Ultimate Rewards are some of the best in the travel credit card industry. When talking with anyone that loves travel rewards, it is a sure bet that they have multiple Chase credit cards in their wallet.

Ultimate Rewards have incredible value. Cardholders can redeem them for up to 1.5 cents per point when booking flights, hotel reservations, and tour packages. They can transfer to one of 13 hotel and airline partners on a one-to-one basis. Or the points can simply be redeemed for cash at one cent per point. This includes the Chase Freedom and Chase Freedom unlimited, which are cash back cards whose points can combine with other Ultimate Rewards-earning cards.

In the summer of 2018, Chase added a rule that if a cardholder has one Sapphire Card, they cannot open another card in the Sapphire family. For example, if you have the Chase Sapphire Reserve Card open, you cannot submit a Chase credit card application for the Chase Sapphire Preferred Card.

Maximum Number of Cards

There is no formal policy about the maximum number of credit cards that someone can have with Chase. I personally have 11 personal and small business credit cards with Chase.
However, Chase does have a global credit limit for each individual borrower. I’ve bumped up against that limit for many years. Whenever I apply for a new Chase credit card, I’ve either needed to close an existing credit card or move some credit limit from an existing card in order to get approved.

Number and Timing of Applications

With so many people coveting their credit cards, Chase created the signup bonus restrictions known as the Chase 5/24 Rule. This rule limits  how many new credit cards applicants could receive from Chase. The 5/24 Rule is an unwritten rule that denies applicants who have opened five or more new credit cards in the last 24 months. This limit includes store-branded credit cards, home equity lines of credit, and personal lines of credit. Becoming an authorized user on someone else’s credit card also counts towards 5/24.

If you open small business credit cards with other banks, most will not count towards the 5/24 Rule. Although the inquiry will post to your credit report, small business credit cards are generally not reported on your personal credit report. Capital One and Discover can be an exception to this rule.

Many of the Chase co-branded credit cards were initially excluded from the 5/24 Rule, but slowly more of them are adding this exclusion to their applications.

When submitting a Chase credit card application, limit your applications to no more than two within 30 days. Anything over this limit will automatically be declined. You can apply for both on the same day to minimize credit inquiries or space them out.

For more information about the Chase 5/24 Rule, read this article – Chase 5/24 Rule – Exceptions, Application Tips and More.

Welcome Bonuses

For most Chase credit cards, applicants are not eligible to receive a welcome bonus for 24 months from the date the last bonus was received. Take note of this distinction because most other banks are focused on the date the account was opened or closed, not the date the bonus was received.

Sapphire Cards – In the summer of 2017, Chase implemented a rule prohibiting earning the welcome bonus on a Sapphire card if you’ve received the bonus from any credit card in the Sapphire family in the last 24 months. Just one year later, Chase expanded that rule from 24 months to 48 months. That means you need to wait four years in between bonuses from the Chase Sapphire Reserve or the Chase Sapphire Preferred.

Marriott Cards – With the Marriott/SPG merger, the result is a lot of complications with who can apply for what Marriott credit cards. There are many personal and business Marriott cards to choose from between Chase and Amex. Each card has its own rules. The bottom line is that you most likely won’t get the bonus if you have a Marriott co-branded credit card open or have received a welcome bonus in the last two years.

Southwest CardsSouthwest has three personal credit cards available. If you have any Southwest personal credit card open or have received a bonus in the last two years, you won’t receive a bonus on a new personal Southwest credit card. The Southwest business credit card is not affected by this rule, nor does it factor into it.

Citibank Credit Card Application Rules

Citibank Credit Card Application

Citibank has two families of personal and business cards that are very appealing for travelers – American Airlines and ThankYou Points. There are several credit cards from each family to choose from. However, Citibank has a two-year limit to receive the bonus on those cards.

Maximum Number of Cards

I have not seen rules limiting the maximum number of Citibank credit cards that a cardholder can have. Before the Hilton Honors portfolio moved to American Express, I had seven personal and small business Citi cards.

Citibank is similar to Chase in that they have a maximum total credit limit that they will approve an applicant for. When you check your Citi application status, it may be pending until you either cancel an existing credit card or agree to move credit limit from one card to the new one.

Number and Timing of Applications

The Citibank credit card application rules allow you to apply for multiple cards within a short period of time. You can apply for no more than one card every eight days and no more than two within 65 days. If you want to apply for three Citibank credit cards, apply for the first on Day 1, second on Day 9 (or later), and third on Day 66 (or later). When you apply, you can easily check your Citi application status online rather than waiting on hold to speak with someone.

Welcome Bonuses

Citibank has one of the trickiest signup bonus restrictions. Before you submit a Citibank credit card application, know that you cannot receive a bonus if you’ve opened or closed a card in that family of cards in the last 24 months. Most other banks focus on the open date or when the bonus was received. Adding in the close date adds another wrinkle to your credit card strategy.

The family language applies to both personal and business credit cards within the same family of cards. Family means the type of card, such as ThankYou Points or American Airlines. For example, if you have opened or closed the Citi AAdvantage Platinum Select within the last two years, you cannot receive the welcome bonus on the Citi AAdvantage Executive or CitiBusiness AAdvantage Platinum Select.

My strategy to avoid this problem is to open a card, wait two years, apply for the next card, then cancel the first once the second has been approved. If you cancel within 30 days of the annual fee posting to your statement, it will be waived.

Barclays Credit Card Application Rules

Barclays Credit Card Application

The Barclays credit card application rules have been tougher to figure out than other banks. There are plenty of data points, but many are conflicting and none are concrete.

Data points suggest that Barclays will deny applicants that:

  • do not spend enough on existing Barclays credit cards
  • who have too much credit with Barclays
  • have too many accounts with other banks

Before submitting a Barclays credit card application, use your existing Barclays personal and business cards. You might want to consider reducing your credit limits as well.

Maximum Number of Cards

Barclays also has a limited portfolio of credit cards. A quick glance at their website reveals 23 credit card options, with American Airlines, JetBlue, and Hawaiian Airlines the airline brands most travelers would recognize the most. Barclays also partners with Uber and Priceline and has their own points card called the Arrival. The Barclays Arrival card is similar to the Capital One Venture where points are used to offset travel expenses purchased on the credit card.

Generally, you will be limited to one of each Barclays credit card at a time, with no specific limit of the total number of credit cards you can have at once. I’ve had up to three Barclays credit cards open at once.

Number and Timing of Applications

When applying for a Barclays credit card, you should limit your applications to one new Barclays card every six months.

Barclays is sensitive to applicants who have a lot of inquiries. If you plan on applying for a number of credit cards within a short timeframe, Barclays should be the first application you submit.

Welcome Bonuses

Barclays doesn’t have special rules limiting bonuses based on your past history with that credit card. If you are approved for the card, you will receive the bonus.

To receive the bonus on the same credit card again, you must close the credit card and wait at least six months after it has closed before reapplying.

Bank of America Credit Card Application Rules

Bank of America Credit Card Application

Bank of America was a popular bank for many years. They would allow applicants to apply for many credit cards of the same flavor time and time again while granting the sign-up bonus every time. I have friends who had several Alaska Airlines credit cards open at the same time.

The bank has started to restrict this behavior by implementing reasonable limitations on applicants.

Maximum Number of Cards

A new rule was introduced for applications with Bank of America. It is called the 2/3/4 Rule. Unlike the Chase 5/24 Rule, this rule only applies to the number of new credit cards opened with Bank of America.

The 2/3/4 Rule states that applicants can receive up to two new credit cards per 2-month period, three new cards every 12 months, and four new cards every 24 months. These periods are rolling. This means that as soon as one previous new card falls off, then you can apply for another new card with Bank of America.

Number and Timing of Applications

Applicants used to apply for multiple credit cards with Bank of America in a single day. With the new 2/3/4 Rule, it is best to space out applications. I’ve seen reports of multiple applications in a single day leading to denials and possible existing accounts being closed.

Welcome Bonuses

Bank of America recently introduced limitations on signup bonus restrictions when applying for a card you’ve previously held. The Bank of America credit card application rules now state that you will not be approved if you have the card open or have closed it within the last 24 months.
If you are applying for a credit card within the Bank of America portfolio that you have opened or closed within the last 24 months, the 2/3/4 Rule will apply. You will receive your bonus after meeting the minimum spend requirements.

Discover Credit Card Application Rules

Discover Credit Card Application

Discover is another bank that has a limited number of credit cards available. There are multiple flavors of the Discover “it” credit card. The original Discover it credit card offers rotating quarterly 5% cash back categories, while another offers unlimited 1.5% in miles. Several other Discover it cards are targeted to specific niches.

The Discover credit card application rules are very simple.

Maximum Number of Cards

Cardholders can have a maximum of two Discover credit cards at any time. This restriction is not a big deal because Discover does not have any co-branded credit cards with airlines or hotels.

Number and Timing of Applications

Before you can apply for a second Discover credit card, your first account must be open for at least one year. Additionally, you may only open one student credit card at a time.

When you are ready to apply for your second Discover card, keep in mind that you can only open one new Discover card every 24 months.

Welcome Bonuses

Discover does not offer big welcome bonuses like other credit card issuers. Instead, Discover will double whatever cash back or rewards you earn in the first 12 months after application. Depending on how much you use your credit cards, the doubling of rewards could be worth far more than a traditional welcome bonus offered by other credit cards.

Wells Fargo Credit Card Application Rules

Wells Fargo Credit Card Application

Wells Fargo is a large regional bank, yet their credit card portfolio is limited to just seven credit cards. All of their credit cards are bank credit cards and none are co-branded with a partner.

The Wells Fargo Propel American Express Card has been popular since its introduction. The credit card offers 3x points on a lot of categories, including:

The Propel card is a great credit card for powerful earning of 3x points on so many categories.

Maximum Number of Cards

I have not found specific language about the maximum number of credit cards allowed by Wells Fargo. However, Wells Fargo is known to be a relationship-based bank. I’ve seen reports of applicants being declined for not having an existing banking relationship before applying. Consider opening a bank account with Wells Fargo if you want to improve your chances of being approved.

Number and Timing of Applications

Express language on the Wells Fargo website states that applicants may not be approved if you’ve opened a Wells Fargo credit card in the last six months. With only seven credit cards in their portfolio, it doesn’t make sense to apply for more than one credit card at one time.

Welcome Bonuses

Wells Fargo is another bank whose welcome bonus restrictions are based on time. Instead of limiting it per credit card, if you’ve received a bonus from any Wells Fargo credit card in the last 15 months, you are not eligible to receive a welcome bonus from another credit card.

What Happens When A New Credit Card Is Introduced?

Many banks have welcome bonus restrictions  for rewards credit cards that you’ve owned in the past. However, when a new credit card is introduced, past ownership of credit cards generally isn’t a factor.

When a new credit card becomes available, there is a strong likelihood that you’ll receive the welcome bonus when applying for that credit card. How long does it take to get approved for a credit card that is new to the market? Banks want the new product in the hands of consumers and small business owners as fast as possible. So new credit cards tend to have a faster approval process than established credit cards.

What To Do If Your Credit Card Application Is Denied?

What To Do If Your Credit Card Application Is Denied?
Even though you now know the credit card application rules of each major bank, it doesn’t mean that you’ll automatically get approved when you applying for a credit card. Declines do happen, even to the best of us. You don’t want your credit to be negatively affected, so here’s what to do if your credit card application is denied.

1. Apply Again With Caution

Every time you submit a credit card application, a hard inquiry is added to your credit report. These hard inquiries can reduce your credit score three to five points each.

If you were declined for the credit card you initially wanted, see if the bank has pre-qualified offers for you. Pre-qualified offers factor in your credit profile and show credit cards that you have a high probability of getting approved for.

2. Review Your Adverse Action Letter

Within seven to ten business days after being declined, you will receive a letter from the bank. This letter’s technical name is an adverse action letter. The letter will provide clues about why the bank declined your credit card application.

3. Request Your Free Credit Report

Applicants who are declined are entitled to receive a free credit report. Contact the credit reporting agency to receive your free credit report. You can download it on your computer or request to receive it by mail. Take the notes from your adverse action letter and review your credit report to understand how to address the bank’s concerns.

If your credit score is too low, this article explains how to improve your score quickly.

4. Review Your Free Credit Score

Free credit reports do not include your credit score. However, the adverse action letter should include your credit score. Your credit scores change all of the time as information is updated. Here is how you can receive your free credit score from all three credit bureaus.

When you combine the information found in the adverse action letter, your credit report, and your credit score, you’ll have a roadmap for what to do before applying again.

5. Repair Your Credit

If you have negative items on your credit report, it is important to address those issues. A delinquency, unpaid collections, or high credit utilization can really impact your credit score.

We recommend working with a credit professional who can help you clear up those old issues. And if you have high balances on your credit cards, consider a debt consolidation loan or a balance transfer credit card to reduce your utilization and pay off that debt.

6. Apply For A Retail Store Card

It is often easier to get approved for a retail store card than a traditional credit card. These credit cards can only be used at the stores owned by that retailer. The credit limits will start out low but will increase with responsible use.

One of our favorite ways to get a retail store card is the shopping cart trick. Read this article to learn how to get a pre-approved retail store card.

7. Get A Secured Credit Card

Applying for a secured credit card is the surest path to getting a new credit card. In order to receive your secured credit card, you place a deposit with the bank that issues the card. Your credit limit will usually start at the same amount as your deposit.

Some banks will increase your limit over time with responsible use and on-time payments. And a few will automatically convert your secured credit card into an unsecured credit card when you qualify.

Which Credit Cards Should You Apply For Next?

Which Credit Cards Should You Apply For Next?

With so many restrictions, it can be difficult to know which rewards credit cards to apply for next. It really depends on your situation. Here are a few scenarios to think about.

Best Credit Cards For Everyone

Capital One has several great new or upgraded credit cards that most people have not applied for. The Capital One Venture offers good value at two points per dollar with the added flexibility of added transfer partners. For foodies and people who go out a lot, the Capital One Savor Card gives 4% cash back on dining and entertainment, plus 2% cash back at the grocery store.

Best Credit Cards If You’re New To Rewards

If you have opened less than five new cards in the last two years, Chase is a good place to start. The 5/24 Rule welcome bonus restrictions will affect you even if you’ve never applied for a Chase credit card before. Because Chase incorporates your new credit cards from other banks into their decision, you want to apply for their credit cards before you become ineligible. A good start is a combination of the Chase Sapphire Preferred and the Chase Business Ink Preferred.

Best Credit Cards If You’re Over 5/24

The best credit card if you’re over 5/24 is the one that aligns with your goals. Planning to fly for your next vacation, get a co-branded airline credit card. It will eliminate checked bag fees and give you priority boarding. Need a hotel room, apply for a co-branded hotel credit card. You’ll get instant status with the hotel and possible upgrades. Many hotel credit cards also offer a free night each year you renew the credit card.

If you want to maintain your flexibility, I like the Capital One Venture Card. It provides 2 miles on every purchase and you can book any flight or hotel room without blackout dates. And now that they’ve added airline transfer partners, the credit card is hard to beat.

Have you been disqualified from applying for credit cards?
What bank rule frustrates you the most?

Let us know in the comment section below.