What's the 5/24 Rule for Credit Cards?
Under the 5/24 rule, you may be declined for a new credit card if you've opened over five or more cards in the past 24 months. Many card issuers use a similar rule.
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It's no secret that credit card issuers use welcome bonus offers to attract new sign ups. To limit sign ups from people who solely want to churn through welcome offers, card issuers may implement credit card approval policies. One example is the 5/24 rule.
What is the 5/24 Rule for Credit Cards?
The 5/24 rule is an unofficial credit card approval policy. If you've opened five or more credit cards in the past 24 months, a card issuer who enforces the 5/24 rule won't approve you for a new one, even if the credit cards are from different credit card issuers.
For example, let's say the following are your most recently opened credit cards:
- Card A opened in March 2022
- Card B opened in May 2022
- Card C opened in June 2022
- Card D opened in April 2023
- Card E opened in October 2023
In this example, opening Card E puts you past the 5/24 limit. If you're interested in a credit card from a card issuer that enforces the 5/24 rule, you won't be eligible until April 2024. The rule only focuses on the account opening date, so closing an account won't reset the clock. Denied applications won't count against the limit, though too many recent inquiries might separately lead to rejection.
Authorized user accounts opened in the past 24 months can also push you over the limit, depending on how they appear on your credit report. However, the card issuer may reconsider your application if you reach out and explain that you're only an authorized user on the account.
Being under the 5/24 limit doesn't automatically mean you're approved. The number of recently opened credit cards is just one factor in credit card approval. Your income, debt levels, credit history, and other factors also influence approval decisions.
How to Navigate the 5/24 Rule
The 5/24 rule can play a significant role in your credit card application strategy, particularly when you're going after the most attractive credit card offers. If you're considering several different credit cards, you might prioritize applying for credit cards with high rewards, valuable perks, or attractive sign-up bonuses.
Consider asking your card issuer for a product change rather than applying for a new credit card. You may be able to upgrade or downgrade an existing credit card without impacting your 5/24 status, depending on how your credit report changes.
Keep track of your credit card open dates so you'll know when you're approaching the limit or when the limit no longer applies. You can also check your credit reports for the open dates of your newest credit cards to determine whether you've triggered the 5/24 rule.
Not all card issuers enforce a 5/24 rule. Some card issuers are more lenient, and others don't have a policy. You won't find these policies online, not officially at least. They're typically part of the company's internal credit approval criteria and aren't publicly disclosed.
In addition to card application rules, card issuers may impose restrictions on welcome offer eligibility. Approval for a credit card doesn't automatically guarantee eligibility for a welcome offer. Unlike policies like the 5/24 rule, the rules regarding welcome offer eligibility are typically outlined in the cards terms and conditions.
Conclusion
If you're reasonably certain a card issuer uses the 5/24 rule, it's smart to delay new card applications until you're in the clear or choose another card issuer. Credit card policies and rules can change, so staying informed is crucial. It's always a good idea to check the most up-to-date information from the issuer before applying for a credit card.
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LaToya Irby is a financial writer with over 14 years of experience. She's been quoted and published as a credit expert in several major publications including USA Today, U.S. News and World Report, TheBalance.com, and The Chicago Tribune.