Q&A: Credit Card Military Waivers & Churning Plan

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After my last update on my credit card churning experiment, Megan asked a couple of questions in the comments.

I decided to make this into its own post, because these aren’t short answers. So today I’ll be delving into some of the technical details of this experiment. If you aren’t eligible for military fee waivers, skip down to the answer to question 2. Unless you are curious, in which case – read as much as you want!

Question 1: How To Waive Annual Fees For Military Personnel

1) Can you talk through the process when you contacted the companies to request waiving the annual fee for military members?”

If you’ve been following along with my experiment, you know I’ve added two credit cards to my wallet – a Chase Sapphire Preferred and an American Express Platinum card (referral links). I also previously had another Chase card and a separate card from way, way back when I was in college.

Chase

Up until very recently, Chase did not offer any benefits to military members (that I know of anyway) that weren’t required by law – specifically the Servicemembers Civil Relief Act (SCRA). A lot of people attribute many, many benefits to this legislation that actually have nothing to do with it. For instance, waiving of annual fees is not part of SCRA, so Chase didn’t waive annual fees for military members. The companies that do waive annual fees for military members are doing it voluntarily to show support for the military – it has nothing to do with SCRA (even if they list it on an SCRA explanation page).

What does that mean for me? It means that when I called up Chase to see if I could get my annual fee waived because I was in the military, the answer was no. I don’t remember exactly when I called, but it was sometime in late September 2017 because my annual fee for my first Chase card (not the Sapphire Preferred) was due on October 1st. So – no joy on getting this annual fee waived. Keep that in mind, it becomes important when I move on to question #2.

My second Chase card, the Sapphire Preferred, has its annual fee waived for the first year as part of the signup offer available to everybody. Because of that, I haven’t done anything yet to request it be waived. I’ve only owned the card for a few months and that is something I would normally do closer to the due date.

Military Lending Act (MLA)

That being said – in mid October, Chase announced that they would begin waiving annual fees for military cardholders as part of their response and compliance with the MLA.

NOTE: MLA is not SCRA (I keep seeing people conflate them in discussions online)

Many others have written about this, so I won’t go into detail. You can find more information here. Bottom line, Chase is now waiving annual fees for military members – but only for credit cards opened after September 20th, 2017. That means neither of my current Chase cards qualifies for the fee waiver. So when my next annual fee comes due, I plan to call up to Chase and ask them to waive it. If they don’t (which is what I expect to happen) I’ll either downgrade the card to a no-fee option or close the account. Which one I decide to do will be based on the current rules in place at the time.

By the way, I’ve seen several articles claim that Chase is waiving the annual fee because MLA requires that companies not charge military members an APR above 36%. While that rule is true, it is optional for the companies to consider the annual fee part of the military APR. That’s why you aren’t seeing articles about all companies suddenly waiving annual fees.

You can find out more about the Chase Sapphire Preferred card, including my bonus and included benefits, here and here.

American Express

In order to get my AMEX annual fee (a hefty $550/year normally) waived for my military service, I went to the AMEX SCRA page and followed the instructions there. I chose to call the provided phone number – you can also apply online, via fax (those still exist?), or by mail.

The phone call was simple – I explained that I was a miltiary member looking to activate my SCRA benefits and get my annual fee waived. The customer service agent at AMEX asked me a few questions that would be used to verify my service. The phone call took maybe 10 minutes total.

I was told verification and activation of my benefits could take up to 30 days; it ended up taking about two weeks. The website says 60 days, so don’t get mad at me if yours takes longer! I received an email saying “we are handling your account referenced above in accordance with the Servicemembers Civil Relief Act” and then it explained some of the benefits I was receiving, including waiving my annual fee. Or rather, they called it “suppressing” my annual membership fee. Whatever, so long as I don’t have to pay it I’m happy!

Other “suppressed” fees include overlimit fees, late payment fees, returned payment fees, and statement copy request fees for the duration of my active military duty service. I have to say, that’s incredibly generous of them. Another reason to love the AMEX Platinum!

You can find out more about my AMEX Platinum card, including my bonus and the included benefits, here.

Question 2: Long Term Plan For Opening/Closing Cards

2) What’s your plan for churning long-term to close/open the same or similar cards to get the “new sign-up bonus”? i.e. When you first opened the CSP and AMEX cards, you got the sign-up bonus for spending $X in the first 3 months. If I don’t want to be opening up new cards forever, is there a way to eventually close these cards and re-open them at a later time to get the new sign-up bonus?”

This one is complicated, because the rules are constantly changing. So this is my plan at this moment. It may change at any time.

BLUF: if you want to keep earning signup bonuses, you will indeed have to keep opening cards. Whether they are new to you or not, though, depends on several things, including the company’s rules and your own objectives.

First up, in case you skipped the first part, let’s recap which credit cards I currently have (or recently changed).

1. My oldest credit card, which I use just a couple times each year. I keep this one open to maintain my long credit history. This card offers cash back and has no annual fee.
2. My Chase United Mileage Plus card. I opened this one in 2013 to take advantage of a signup bonus and have used it as my daily card ever since.
3. The Chase Sapphire Preferred Card (referral link). This is the card I opened when I first started this experiment.
4. The American Express Platinum Card (referral link). I opened this card at the beginning of October.

Oldest Credit Card

I’m not going to close this one. There is no signup bonus, so closing it down won’t allow me to earn another eventually. It has no annual fee. Keeping it open keeps my credit history lengthy – and closing it means my oldest card would only be 4 years old. ’nuff said.

Chase Card #1

The card I opened in 2013 is one of Chase’s United cards. United is my airline of choice because it offers direct service to my most frequent destinations. When I was looking for a new card back then it made sense for me to look for one that gave me United points. This is the one I went with.

This card has an annual fee. Given the benefits of the other cards I’ve since opened, there was no reason for me to keep paying this fee. But, I wanted to keep the account history open, plus the large credit limit on this card helps keep my credit utilization low. That’s important if you want to keep your credit score high.

So I called up Chase and asked whether they’d waive the annual fee. If you read my answer to question 1, you know the answer was no. Then I asked about converting this card into a no-fee card. The phone call took about 15 minutes total, mostly because I kept asking questions because I wasn’t aware of the process. I’ll save you the trouble and tell you what I learned.

Chase United MileagePlus Cards

In order to convert this card to a new card, it had to stay within the Chase United MileagePlus family. There were a couple cards to choose from, but most of them required an annual fee. Since the whole purpose of switching was to avoid the annual fee, I ended up with the base level card. That’s perfectly fine with me. Like I said, the primary reason for keeping this card is to keep the history open – this card does that. The other benefits that are available on the cards that have annual fees are already covered by the credit cards listed below, so I don’t need them from this card.

If I decide to get this card again to get another signup bonus, I just have to wait two years since I last earned the bonus. That’s Chase’s current rules – which could change at any time. Since I earned this bonus in 2013, I could do that now if I wanted. Therefore, this card is already in the running as a potential card for my card churning experiment.

Chase Sapphire Preferred Card

I plan to keep this card open for the time being. Since Chase’s rule is that you can’t earn the bonus on the same card for 24 months, and my fee is waived for the first year, there is no reason to close it now. However, they also recently changed their rules to say that you could only get one bonus within the Sapphire family within 24 months. That means I can’t get the bonus for the Chase Sapphire Reserve until 2019. Bummer. 

Will I close this card in 2018? If they don’t waive my annual fee – probably. However, since Chase gives me Ultimate Rewards points on this card (as opposed to giving me United miles on the other card) I need to either use those points or transfer them to a partner before I close the card. Otherwise, the points go bye-bye. That would not be good! So look for future posts where I either use those points up, or open another card that gives me Ultimate Rewards points (as long as I have one card that earns UR points I can keep them), or I transfer them to a partner (probably United).

American Express Platinum Card

I have no intention of closing this card while I remain in the military. With the incredible travel benefits and AMEX’s waiving of the annual fee for active duty status military personnel, there’s no reason I should. Keeping it open will let me continue to use those benefits throughout my career. When I’m no longer in the military, I’ll assess whether it’s worth the money to pay for the annual fee on this one. I can definitely see how I will get hundreds of dollars worth of value out of it every year.

Also: AMEX doesn’t allow you to re-earn the signup bonus on any particular card, so closing this account wouldn’t benefit me in the future. So I’ll just keep it open! If I want to earn more bonuses from AMEX, I can always sign up for a different card.

Future Cards

Again – every card and company is different, so whether I close the cards in order to re-earn bonuses will depend on that particular card’s rules. I suspect I will keep some cards open – especially if I open any more that have waived annual fees and don’t allow me to earn the bonus more than once (AMEX). Others I will close and reopen to re-earn the bonus. Some I might close and never re-open. We’ll see. I plan to stay flexible and follow the whims of the credit card companies.

So that’s my plan for now. I hope that helps, Megan!

Okay smart card churners out there – anything I’m forgetting? Any other tips or strategies that would be helpful to Megan and others?