What are the pros and cons of sticking with the major credit card issuers (Citibank, BofA, Chase, AMEX) during AOR / BT investing? I’m thinking of the long term strategies for second, third, etc. AORs. On one hand, sticking with the majors and reallocating CL every AOR round has the advantage of fewer apps and the resulting benefits of fewer inquiries, fewer accounts, less complexity, etc. However, FWers often reporting hitting a total exposure ceiling with the big issuers, thus limiting the growth of their lines. Going after lesser players (HSBC, U S Bank, Elan, etc.) may help increase the total available credit for BT investing but with the side effects of more accounts and complexity. Also, I’ve noticed per the credit card issuer faq that the “mid-majors” often frown upon reallocation, which limits the appeal of these accounts for the long term.
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The majors allow fancy reallocation games, and usually have better sign up bonuses. Both the reallocation opportunities and the promotions typically drop the smaller the financial institution is.
However the majors (with the possible screwy exception of AMEX) also tend to have a max exposure that they are willing to tolerate per customer.
My approach is to apply for both. Stick with the majors because that's where the juiciest deals are, but also throw in other lenders for diversity's sake if they have a reasonable deal.
(Incidentally, I find that multiple cards with one lender is just as complicated as single cards with multiple lenders, especially because of the complex opportunities that reallocation games provide)
In my experience, the three HSBC accounts that I opened in my first AOR have proven valuable, despite low credit lines. I was able to consolidate two of them into one modest CL, then use the no-fee BT feature to bounce the minimum payments from my Citi and Chase AOR loans back and forth, thereby not paying any minimum at all. The downside is that the low CL has dragged my FICO score down somewhat. Hopefully with time I can request a CL increase, then roll that over to accounts opened in subsequent AORs to actually earn some money, rather than just to use this card as a minimum monthly payment shuttle.
Also, the other of those HSBC accounts is the ever-useful 2% CashBack card, which has become my default card for purchases that aren't eligible for more specific 3% restaurant or 5% gas/grocery rebates (for which I use the Costco AMEX and Chase Rewards Plus, respectively).
lhendricks92 said:What are the pros and cons of sticking with the major credit card issuers (Citibank, BofA, Chase, AMEX) during AOR / BT investing? Pro: fewer cards = less work Con: fewer cards = less money
Personally I don't find each additional card to be much more work; the work is in the whole process.
I even think it's worth applying for non-BT, non-realloc cards to keep overall utilization down (or to get more BT $ for whatever level of utilization is chosen).
cardjuggler said:BTW, National City allows reallocation.
thanks for the tip. do you have personal experience with National City reallocation? just had a conversation with a National City phone rep. he said they do not allow reallocation between a business and a personal card, nor between 2 personal cards.
lhendricks92 said:do you have personal experience with National City reallocation? I know someone who did it within the past few weeks between 2 personal cards. $12,500 new + $15,500 old (leaving $500). It sounds like this is YMMV (as with Discover), i.e. call again to get a different rep.
Even without realloc, it's a good BT card. The old one reduces overall utilization.
cool, thanks. i'm definitely going to add the Nat City Business Visa to my AOR tomorrow, and probably the personal Visa, too. maybe i'll luck out and get a single pull. thanks again for the heads up.
I'd really like to expand on this thread and gain the experiences of the 'godfather(s)' of the AOR concept. Those of you that have been doing it for years, SIS, DH and others, what have your experiences been on the mid-majors or have you really just stuck to your guns and gone majors only.
From polardude's Mega thread, the following is being snipped
SUCKISSTAPLES said:It certainly does not require new banks to do more AORs.
I have done numerous AORs and find that the SIMPLEST and BEST strategy is to accumulate a good base of cards from various major issuers ....then on subsequent AORs, you can target the best promos out there and include maybe 1 card from each major issuer you already have cards with. Then reallocate your existing credit lines to use the new BT promos. This results in max benefit for minimum work. ~snip~
It's possible this was meant specific advice for Polardude, but I'm not sure if best promos is meant for the majors or any of the issuers.
One could pretty easily hit all major banks in 10-12 cards personal and business for BT purposes. This leaves 8-10+ cards left for whatever your fancy. In my AOR thread I went for the issuers new to me first to establish relationships and the majors second. While 'the night is young,' this seems to have worked in obtaining (counting a business card and personal card by the same issuer separately) 12 new issuers and still getting the benefits of the majors. The resources are minimal the credit card issuer nearly blank on most of these issuers, I think lhendricks92 had a great idea on this thread and hope to kickstart it with a bump......
I hate to sound like a pessimist, buy you might also want to think about the longevity of these 0% BT offers in the future. While I personaly believe they will be around for at least another 3-5 years, and hopefully longer, the terms are getting worse for us (compared to what they used to be). I am specifically referring to higher BT fees and non-capped BT fees. There are still ample good deals out there now, but AMEX for example only has the IN set of cards at 0% BT (unless you get a special invitation) and it seems like others are reducing their total number of promo BT cards (not Citi though!).
I think a blend of major and minor is good. I agree with CardJuggler that an addittional card is not that much more effort in the AoR game. You do want to establish a good total CL with the majors during AoR 1.0, therefore leaving opportunities to just apply for one single new BT card with the majors in the future and reallocate CL's if possible. This tactic may also delay when you reach the max exposure limit that has been discussed. The minor companies should be thought of as supplemental opportunities, but should nevertheless be used when availabe.
I wouldn't worry too much about inquiries, as they become less important after 6 months and drop off after 2 years. If you do an AoR every 13 months, they should not be a big issue for you. Also, considering you can get rid of Equifax and Transunion inquiries with TrueCredit Bumpage, the only inquiries left will be the Experian. As an example, I applied for 34 cards and got the following inquires:
I'm signing up with TrueCredit for $11.21 a month (via WalMart link) and doing daily pulls for 60-90 days to get rid of all the Transunion and Equifax inquiries. This will leave me with only 5 total inquiries for 34 cards when I do AoR 3.0 in another 12 months. Hope this provides some insight.
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