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Did you know that this is a great way to preserve your credit and get approved for card?
It’s true. When you cancel a credit card and lose the line of credit that it had given you, your score drops. Why? It decreases the total amount of credit available to you, and thus, increases the percentage of credit you use every month. That percentage is one of the 5 factors that determine your credit score called utilization ( we have a whole memo on it if you’d like to read more) and it affects your credit score A LOT. So, if you don’t want to pay that annual fee, thin out the wallet, or you’re just strategizing to pick up another bonus on that same card – you need to preserve your credit line. How can you do that? You can move your credit line between cards. This is also a great way to get approved for a new card. Lemme explain.
Most Banks will move your credit line from one card to another.
- When opening a new card
In fact, this weekend I did it twice. Once was to get approved for a Chase Sapphire Reserve, and the other was for a Barclay Aviator Red World Elite. In both of these instances, the bank had extended their max amount of credit to me, and the only way that they would approve me was to move part of an existing line of credit to the new card. This is something that they will ask, or if they don’t, something that you should offer in a retention call.
- When canceling a card
I will approach this when I cancel my current Barclay Aviator ( the card whose line I split to get approved for my Barclay Aviator Red). In order to keep my overall credit utilization very low, I will move the remaining line of credit ( or part of it) to the new card. Chase is notorious for allowing quick and easy moves between cards. It’s also a reason to keep a fee free card alive and well. As the years pile up on a card that costs you nothing to keep, you’ll not only increase the average age of your credit, you’ll maintain an account to move your credit line in and out of as you sign up or close accounts.
Does moving a line of credit result in a hard pull on your credit?
The answer is depends on the bank. Here’s my experience.
- Chase
- Never had a pull and customer service reps can handle a line transfer easily
- Citi
- Hard pull when joining or splitting credit lines
- Upon account opening they can pull from one line to another and only one hard pull is the result
- Barclay
- Upon cancellation I joined two lines without a hard pull
- Upon account opening I just split lines without an additional pull
- Amex
- I’ve never had a pull to join or extend credit line increases ( this only applies to their credit cards, not charge cards)
You can also go here to see an extensive list of card issuers and their policy from Doctor of Credit
Interested in reading more tips for Beginner’s? Check out our Monday Miles Monday Memos
Each Monday Miles has decided to drop a tip, hint, tutorial, trick that maybe you’ve missed or haven’t heard before. If you’re an expert in this field, some of these may be things you already know, but there are a lot of beginners out there who are just getting their feet wet – and these posts are for YOU!
Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
Chase Sapphire Preferred® Card
Welcome Offer
Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening.
Annual Fee
$95
Points Earned
Transferrable Chase Ultimate Rewards
- 5x on all travel purchased through Chase Travel℠
- 3x on dining, including eligible delivery services for takeout & dining out
- 3x on select streaming services
- 3x on online grocery purchases
- (excluding Target, Walmart and wholesale clubs)
- $50 Annual Chase Travel Hotel Credit via Chase Travel℠
- The begins immediately for new cardmembers and after your account anniversary for existing cardmembers
- 2x on all other travel
- 10% Anniversary Bonus
- Every year you keep the card, your total spend will yield a 10% points bonus. If you spend $10k in a year, you’ll get 1k bonus points
- Chase Sapphire Preferred continues to redeem at 1.25c in the Chase Travel℠ and the slew of other benefits remain in tact including Auto Rental Collision Damage Waiver ( primary ), purchase protections, etc.
- Points are transferrable to 14 Ultimate Rewards partners
- Redeem in Chase Travel℠ for 1.25 cents per point
- No foreign transaction fees
- Suite of Travel and Purchase Coverage
- Auto Rental Collision Damage Waiver is my favorite
- Get complimentary access to DashPass which unlocks $0 delivery fees and lower service fees for a minimum of one year when you activate by December 31, 2027.
- $95 Annual Fee
We keep an up to date spreadsheet that lists the best ever offers: You can find that spreadsheet here.
Historically 80k is a very, very good offer and hit in both 2022 and 2023. In 2021, we saw the offer hit an all time high of 100k. Who knows if that will ever come back.
Main Cast:
Cards that earn flexible points and should be used on the bulk of your purchases.
Supporting Cast:
Cards that earn fixed points in the currency of the airline/hotel and can not be transferred at attractive rates. These cards yield benefits that make it worth keeping, but not necessarily worth putting a lot of your everyday spend on.
The Chase Sapphire Preferred® is exceptional starter card and offers transferrable Ultimate Rewards, and pairs well with other Chase cards.
If you carry this card alongside Chase’s cashback cards like the Chase Freedom Flex® and Chase Freedom Unlimited® or the business versions: Ink Business Cash® , Ink Business Unlimited® you can combine the points into Preferred account and transfer into hotel and airline partners
Annual fee is quite low at $95 a year + you get a 10% anniversary bonus on points + $50 hotel credit in Chase travel.
The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved, or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.