Credit Card “Churning”: What It Is and How You Can Benefit

Photographic art ©2012 by Brian Cohen.

You may have seen numerous other weblogs whose concentrations usually focus on the subject of travel repeatedly extol the virtues of certain credit card deals, and you might be wondering to yourself about what exactly are they saying and how you can benefit from their advice.

Credit card churning” is an activity practiced by those who like to take advantage of offers by credit card companies in order to receive bonus miles of frequent flier loyalty programs of airlines, bonus points of frequent guest loyalty programs of hotel companies, or even extra cash incentives. These people open multiple credit card accounts each year solely to benefit from the special limited-time offers and then close their accounts immediately when the offer has been satisfied, or just before the annual fee is due on the credit card so that the annual fee does not have to be paid. In fact, some people will open a new credit card account after closing an account from the same credit card company to repeat taking advantage of the same offer if the terms and conditions of the offer allow it.

While the definition of credit card “churning” has never been officially and specifically defined, different people do practice it in different ways and at different rates. For example, here is a recent discussion which offers advice on credit card churning, as well as examples of some recent credit card offers which have been available.

If you do decide to “churn” credit cards, one of the requirements is usually that you must spend a certain amount of money using those credit cards to qualify for the offers.

However, be forewarned that credit card “churning” could adversely affect your credit score — even if only temporarily — depending on the frequency of your activity. Also, if you forget or miss a critical due date associated with the credit card offer, or if you exceed a certain limit as defined by the terms and conditions of the offer, you could jeopardize or negate the offer of which you are attempting to take advantage. While it is a perfectly legal activity, credit card “churning” is not for everyone, so please ensure that you understand the potential risks associated with it.

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Comments (Showing 2 of 2)

  • Plane Crazy « LEG+JCB at 7:07am June 26, 2012

    […] most die-hard of miles collectors, though, so if you’re curious, I recommend you check out this article on FlyerTalk on the rationale and strategy behind […]

  • edflick at 1:32pm October 04, 2013

    B of A and Choice Hotels robbed my account of 54,000 points 4 years ago. I had purposely paid and stayed at Choice Hotels many times to earn points.

    It is true that I earned Choice Hotel points from the credit card from a couple of credit card churns prior to earning many points from hotel stays. If it was a mistake on their part, they should not have punished me for when I paid for more hotel nights.

    I have tried in the past to contact both Choice Hotels and B of A with no resolution on this issue. What do you suggest?

    Thanks, Ed

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