Are Rewards Card Sign-up Bonuses Just for New Customers?


Dear Cashing In,

I have a Chase Sapphire non-preferred card with 29,000 points accumulated. If I cancel this card, will I lose all my points? My intention is to sign up for the Chase Sapphire preferred card that has a 50K point bonus. Thank you for your time. 

- Jonh Upton

Dear Jonh,

I don't blame you for wanting to get in on that deal. The Chase Sapphire Preferred card offers a lot of perks, including 1-to-1 point transfers for several airlines, hotel chains and Amtrak; two points for every dollar spent on dining and travel; and an annual 7% bonus on points earned. Add to that the aforementioned 50,000-point sign-up bonus (after $3,000 spent in the first three months) and you have a very attractive offer.

Unfortunately, as a current Chase Sapphire cardholder, you are not in a strong position to jump on this deal. If you're hoping to end up with 79,000 points total and a better credit card, your chances are slim -- but not none.

To answer your first question: Yes, if you cancel your nonpreferred card, you lose the points associated with that account. Doing that and then applying for a new card would also ding your credit. Whether that ding would be enough in itself to disqualify you for the preferred card depends on your credit record as a whole.

If your credit is excellent, Chase may overlook that bit of recent history. If it's less than stellar, there's a good chance you won't qualify for the preferred card -- this is a popular card right now. That would mean that you'd be out both a credit card and 29,000 reward points, which would be the worst-case scenario.

More important, you will no longer be a Chase cardholder when you apply for the Sapphire Preferred card. So you're not only stripped of the 29,000 points you had in your pocket, you're also applying as a "new customer," which potentially qualifies you for the 50,000 sign-up points but strips you of the power you wielded as a current customer.

The official line from Chase is that if you apply for a Sapphire card while holding onto another, the best you can hope for is a trade-up on your existing account. They may upgrade you to preferred status, but you would have to forfeit the 50,000 sign-up points. That bonus is designed to lure new customers, after all. You are already a Chase Sapphire cardholder. If they upgrade you to Preferred, you protect your credit rating and end up with a better credit card, but you wind up with the same number of points you currently have: 29,000.

However, Chase has been known to make exceptions to that rule. It's definitely worth asking. Your best bet is to call the number on the back of your current Sapphire card and try to negotiate. Ask not only to upgrade to Preferred, but also see if you could get the 50,000 bonus points you would be allotted if you were not an existing customer. Whether or not they agree may depend on how loyal and profitable a customer you've been up to this point.

Like any other business, Chase doesn't want to just attract new customers, it wants to hold on to the ones it already has -- especially those who have proven themselves valuable. Most things are more negotiable than people realize, from the published price of hotel rooms to partial refunds on clothing purchased before a sale. In other words, you have an ace in your hand right now as a loyal customer and it's worth playing, even if what you're asking defies official rules.