Citi Product Conversions & Credit Line Shifts
A few days ago I wrote about an interesting idea I had to convert an existing Citi card to the ThankYou Preferred in order to get one of the very lucrative retention offers that they have been handing out. This past weekend I answered a lot of questions about it at Family Travel for Real Life. I also noticed a few questions on the original post so I thought it might be a good idea to go a little more in depth on the subject.
Product Conversion vs. Credit Line Shift
Citi Product Conversion
A Citi product conversion is when you change from one Citi product to another. For example, I recently converted my Citi AAdvantage Executive card to a ThankYou Preferred card. In most cases you can convert any Citi card to almost any other. A simple phone call can take care of the conversion and the phone rep will be able to tell you which products you are and are not able to change to.
When doing a Citi product conversion, your account number and account history remain in tact. Citi does not run your credit when you convert from one product to another and an account generally needs to be open for a year before it can be converted.
Credit Line Shift
A credit line shift occurs when you want to reallocate a line from one open card to another card. For example, if you have a low limit on a card that you are using often, it may be beneficial to shift the credit so you don’t come close to the limit.
Unfortunately Citi almost treats credit line shifts as a new card application. If you decide to shift credit from one card to another, they will run a hard credit inquiry and ask you questions as if you are applying for a new card. For example, they often ask people for their income.
Citi is also very generous in allowing credit line shifts when applying for a new card. If you have hit the maximum allowable credit with them, you can call to have a shift done in order to get your new application approved. In these cases, they will have already done a credit check for your application and you won’t receive a second inquiry.
Product Conversions & Bonuses
One other angle I want to cover with Citi product conversions is sign-up bonuses. You should always keep in mind that converting to another product may make you ineligible to receive a sign-up bonus for that product.
For example, “if you have had a Citi ThankYou Preferred card opened or closed in the past 18 months” you would not be eligible for a bonus on that card. Since the rules differ by product, the best thing to do is consult the fine print on the application.
Converting annual fee cards to no annual fee cards can be a good way to lengthen your account history and strengthen your average age of accounts. Of course, keeping those cards open also means that it is less likely Citi will approve you for new cards in the future and you may become ineligible for sign-up bonuses on some converted products as well.
Some people prefer to close cards in order to bolster their chances of approval with Citi. I tend to think it is better to keep cards open as long as possible and I have never had an issue shifting credit in order to gain an approval.
Under no circumstance would I recommend doing a credit line shift with a hard inquiry. It is ridiculous that Citi wants to do this, since they have already extended that credit to you on a different card. Getting a hard inquiry without any type of bonus is not acceptable in my opinion.
Hopefully this answers a few of the questions that people have about Citi product conversions and credit line shifts. I highly suggest you don’t shift credit lines unless you are doing so on a new credit card application. It just isn’t worth the hard inquiry for basically nothing.
Of course, everyone’s situation is different and everything mentioned here is a personal decision that you will have to make based on a number of factors. Please let me know if you have any questions.