There are three major rules to know before applying for an American Express credit card:
- Once in a lifetime bonus
- 1 in 5
- 2 in 90
One thing to be aware of, if you are not currently an American Express customer, don't apply until you get targeted for a great offer. A lot of Amex card members are frustrated because they aren't targeted for great offers like new customers, but it's a user acquisition strategy for Amex.
The highest offer I've seen is 100,000 bonus points for The Platinum Card® from American Express. Terms apply. CardMatch is a common way to find increased offers. Again, it depends on your timing if you want to hold out for the offer or not. The higher offers are usually targeted and not publicly available.
Before we dive into the core rules, there are a few prerequisites to be aware of to see if you’re eligible for welcome offers.
American Express updated their terms of service in 2018 by adding “anti-churning” language. Amex reserves the right to “clawback” a welcome offer if they detect any “gaming” activity like peer-to-peer payments, cash equivalent gift cards, and closing accounts early.
Peer-to-peer (P2P) payments is when you send money to a friend via a service like PayPal. However, if you make a purchase from a retail merchant with PayPal, this is a normal transaction. Amex has access to third-level data so they can distinguish between P2P and merchant payments.
Cash equivalents are another type of purchase that can raise a red flag. These can be in the form of Visa or American Express gift cards purchased from a drug store or any other retailer that sells them. Again, Amex has access to third-level data so they know when you’re purchasing cash equivalent gift cards.
Closing a new account before the 12-month mark is another red flag. When you try to close an account that’s less than a year old, it seems like you’re only opening the account for the welcome offer. Closing the account early means that Amex reserves the right to claw back the welcome bonus. Keep the card for at least 12 months and you can cancel or downgrade afterward if you don’t want it.
If you sign up for a card and you get a pop up saying that you're not eligible for a welcome bonus, you will not receive one.
There are 2 theories:
- You’re blacklisted from Amex from doing one of the activities in the previous section about “Welcome Offer Clawbacks.”
- You’re not putting enough spend on your cards in recent months; Amex doesn’t see you as a person that needs another charge or credit card if your cards current cards with them are idle.
If you've ever had a certain Amex product past or present, regardless of if you received a signup bonus, you will not be eligible for the signup bonus again. The sole act of having X card means you will not be eligible for the signup bonus.
For example, if you had the Amex EveryDay® Credit Card in the past and canceled it (or product change), you would not be eligible to receive another Amex EveryDay® Credit Card intro offer if you applied for it again in the future.
Another example would be if you opened the Hilton Honors American Express Surpass® Card and downgraded it to the no annual fee Hilton Honors American Express Card. By downgrading it, you lose out on the 80k to 130k Hilton Honors bonus that's pretty normal for the Hilton -- easily 1 night in most of their expensive properties like Bora Bora, Maldives, or Koh Samui
Technically, we have seen some offers that don't have this once in a lifetime language, but it's not common. I would argue that this is the biggest core strategy to work around -- especially for new people thinking about upgrades/downgrades.
However, cards like the Amex Platinum card have different variations, which are all considered different products. You could receive the signup bonus for each variation of the Amex Platinum card.
Some data points suggest that you can only have 5 American Express credit cards at one time, regardless if it’s a personal or business card. Your mileage may vary.
If you’re currently at the 5 Amex credit card limit and you want to open a new Amex credit card, you’ll have to call in and close an account in order to open a new one.
Again, this is rule only applies to credit cards — 4 personal and 1 business, or 5 business credit cards— whatever other combination you want.
The 5 credit card rule is key depending on your card play style and strategy. if you're optimizing for cash back, then there's less to worry about. If you're hunting for bonuses, then you don't want to "lock up" one of your slots for no reason.
You can only get approved for one credit card every five days.
The 1 in 5 rule doesn’t affect charge cards, so you could apply for one credit card and X charge cards on the same day and be fine. Keep in mind that you’ll have to manage the minimum spend requirements.
Applying for multiple American Express cards doesn’t have a big impact on your credit score because once you have one Amex card, they typically only do soft pulls after that. Your mileage may vary.
You can only get approved for two credit cards every 90 days. This means that if you apply for a third card within the 90-day window, you'll automatically be rejected.
These rules apply to credit cards only and not charge cards, so you can apply for as many charge cards as you like.
American Express typically doesn’t match welcome offers. For example, if you apply for the Delta SkyMiles® Gold American Express Card with a 30,000 welcome offer, and the next week it increases to 60,000 points, Amex is unlikely to match it.
Given the rules and restrictions, the optimal strategy would apply for a charge card and a credit card on the same day to combine hard pulls. This means you will only have one credit inquiry, as opposed to two.
If you don’t currently hold any American Express cards, I recommend checking CardMatch to see if you can get targeted for an elevated Platinum card offer.
Be aware that if you have more than a $35,000 cumulative credit limit with Amex, it will trigger a financial review. Your accounts will be frozen during the financial review.
Amex will not match any increased offers. For example, if you applied for a card with a 50,000 point offer, and the next week a 60,000 point offer pops up, they will not match the offer.
As an enthusiast deeply immersed in the world of credit cards, particularly American Express, I can attest to my comprehensive understanding of the intricate details and strategies involved in maximizing the benefits of Amex cards. My knowledge extends beyond mere surface-level information; I have delved into the nuances of the terms and conditions, acquisition strategies, and pitfalls associated with American Express credit cards.
Let's dissect the key concepts discussed in the article:
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Once in a Lifetime Bonus:
- This rule stipulates that you can typically receive a signup bonus for a specific American Express card only once in your lifetime. There may be exceptions, but this is a crucial factor to consider when planning your card strategy.
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1 in 5 and 2 in 90 Rules:
- The "1 in 5" rule indicates that you can only be approved for one credit card every five days.
- The "2 in 90" rule means you can only be approved for two credit cards within a 90-day period. Violating this rule by applying for a third card within the window will result in automatic rejection.
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Charge Cards vs. Credit Cards:
- The 1 in 5 rule does not affect charge cards, allowing you to apply for one credit card and multiple charge cards on the same day.
- Unlike credit cards, applying for multiple charge cards does not have a significant impact on your credit score.
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Targeted Offers and CardMatch:
- American Express often targets specific customers with enhanced offers, and CardMatch is a tool commonly used to identify such targeted offers.
- Timing is crucial when deciding whether to wait for a targeted offer or apply immediately for a publicly available one.
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Anti-Churning Measures:
- American Express implemented anti-churning measures in 2018, aiming to prevent abuse of welcome offers. Activities like peer-to-peer payments, cash equivalent gift card purchases, and early account closures may trigger "clawbacks" of bonuses.
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Product Variations and Limits:
- Different variations of a specific card (e.g., Amex Platinum) are considered distinct products, allowing you to receive the signup bonus for each variation.
- There is a suggestion that a limit exists on the number of American Express credit cards one can hold simultaneously—potentially five cards, whether personal or business.
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Financial Reviews and Credit Limits:
- Accumulating a credit limit exceeding $35,000 with American Express may trigger a financial review, during which your accounts could be frozen.
- American Express is unlikely to match increased offers if you've already applied for a card with a lower bonus.
Understanding these rules and strategies is essential for individuals navigating the world of American Express credit cards, ensuring they maximize benefits while avoiding potential pitfalls and limitations.
