Not long ago, Advanta closed my business card account when their credit card division folded. I had then expressed my need for a new credit card. Now that I got myself a replacement business card, it seems that I may need to get a new consumer card as well. I have a Bank of America Upromise rewards card that has no annual fees, but I’m hearing rumblings that fees may be introduced for this card soon.
Given that my #1 requirement for a credit card is that it has NO annual fees, then I may have to start shopping around for a possible replacement. I pay my credit card bills in full each month, so I’m most interested in rewards credit cards, and in particular, cash back credit cards that have NO fees. On that note, I’ve decided to be proactive and look at a few such cards in more detail, including Chase Freedom (SM).
Chase Freedom: Credit Card For Cash Back Rewards
The Chase Freedom (SM) credit card is a cash back rewards card with the following features:
- Get a $50 cash bonus on first use or once you’ve made your first purchase.
- Earn up to 20% cash back at select retailers when you shop through Chase.
- Earn 3% cash back in popular rotating spending categories such as gas, home improvement and department stores.
- Earn 1% for all other purchases at all times.
- 0% intro APR on purchases for up to 12 months, based on your credit history.
- No annual fee.
Chase Freedom Card Rewards
Here are a few more details about the rewards: as a new cardmember, you’ll actually qualify for the $50 bonus under many scenarios. You’ll receive the bonus after your first use, which includes making a purchase, doing a balance transfer, or using checks, excluding cash advances.
The cash back rewards are unlimited, which you’ll earn when you make purchases. Note that you won’t earn any rebates when you do a balance transfer or get a cash advance. Also, you’ll qualify for additional 3% quarterly cash bonus rewards when you spend on certain categories. For the 10% to 20% cash back, you’ll have to shop online using your Chase account and using Chase’s Ultimate Rewards Mall.
Chase Freedom Card Terms
Other interesting things to note about this 0% interest credit card (for new purchases): This is a 0% APR credit card that won’t charge you interest on purchases made during an intro period. The intro period can either be 6 months or 12 months based on your credit history.
After the intro period, the card’s regular rates kick in, with variable terms depending on which pricing/rate category you fall under: Elite, Premium or Standard. The card has different rate structures based on your credit rating, so unlike other cards where everyone may receive the same rates at all times (barring some exceptions here and there), this card has variability built into its terms.
For instance, if you’ve got excellent credit, you’ll likely be receiving the Elite pricing terms, and with a more mediocre credit score, you may end up with the Standard terms. The APRs are tied to the prime rate, which is one benchmark for lending used by financial institutions. Chase also reserves the right to decide which rates to offer you. All applications will at first be considered for the most attractive terms, but depending on the credit information the issuer pulls from your reports, your rates will be adjusted accordingly. There is the possibility that you may end up with alternative rates or that your application may be denied.
Also, while this card accepts balance transfers, it’s not really considered a balance transfer card. If you transfer your balance to this card, you will be charged a prime rate plus some additional APR based on your pricing/rate category (as mentioned above).
Other Rewards and Cash Back Credit Cards
Chase Freedom (SM) has been in my list of top cash back credit cards for a while now and I’ve eyed it as a card I’d consider applying for when the need arose. For the record, here are some rewards cards that I’ve been tracking and which I’ve featured before:
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- Stock trades: Free stock trades from Zecco, Cheap stock trades from TradeKing, Stock news and Investment info at INO TV Free, No cost Trend Analysis for stocks
- Earn top returns: FNBO Direct [1.90%], HSBC Direct [1.65%], WTDirect [1.76%], E*Trade Bank [0.95%], ING Direct [.25% to 1.65%]
- Cash bonus: Discover More [$50], American Express [$25], Lending Club [$25]
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{ 13 comments… read them below or add one }
Still it pays to be careful with these “too good to be true offers”.
Actually, the Chase Freedom Card will have an annual fee of $30 very soon. It was sent out to me recently in a mailing. Although, for current cardholders the fee will be waived for the first year of the program. I used to make $500 in a little over a year on the card but now it is more like $300 or so. I am still deciding if I will be willing to pay the fee out of principle as I still stand to make a decent return.
I have received no such mailing for my Freedom card, and I just logged in and checked the paperwork online which states clearly, no annual fees. I’d love to know where that paperwork is supposedly coming from.
However my cash back does expire – 36 months after earned. And besides the initial $50 bonus, saving up to $200 in cash back and then cashing in gets another $50 bonus.
@John,
Chase Freedom has been around a while and from what I understand, it’s been a good choice for a cash back credit card. Sure, credit card offers can be modified at any time (as is the case with my BofA card and Advanta card) but this particular card is one of the more decent options around, IMO. I know a few bloggers who carry it.
I’m on the same page as Rachel. Back in June I received a mailing from Chase saying that they will be charging an annual fee, but it is waived for the first year. I know I keep seeing advertisements for the card stating “no annual fee”, so maybe they’re holding off until next year to start charging any customers annual fees.
MidnyghtChilde: They also stated that the extra $50 bonus for redeeming is $200 cash back is also not valid anymore (starting back in July).
Thanks for the clarifications everyone. I’ll have to keep an eye out on the “no annual fees” matter here. Although maybe that $30 a year doesn’t sound too bad. Still, I wouldn’t like it if this was setting a precedent. To me, it’s the principle. I’d be miffed if the credit card industry started introducing annual fees across the board with credit card companies acting like a cartel.
There are mixed opinions about Chase since they took over Washington Mutual, but I like them so far.
I especially like their Leisure Rewards Debit Card. There is a annual fee of $25.00, but I rack up way more than $25.00 in cash rewards, and gift cards. I also like that its a debit card and I earn rewards without dancing with the credit card monster.
-Dan Malone-
Yeah it USED to be a good card SVB. With the rewards being cut and an annual fee introduced, the card quickly becomes horrible.
If you want a no fuss card, go straight for the Schwab 2% cashback on everything card.
If you want to be rewarded for extra categories (better than the Chase), go with the Discover More card with quarterly rotating 5% cashback categories (gas, groceries, restaurants, flights, etc.)
Essentially there are better cards out there than this. Think before you apply!
The Chase Freedom Card is a good card in the rewards category although one thing that always has bothered me is that the up to 3% categories rotate and they are not fixed like the True Earnings American Express Card which I like better (Disclosure: I have this card personally).
Ah, True Earnings and Discover More are in my favored list, but Schwab also looks interesting. But rewards cards are not “one size fits all” anyway — depending on your spending patterns, one card can work out better for you than another. General 2% cash back may not be the most optimal card if you spend more on special categories (or use the card for such purposes): in that case, the 3% from Chase or the 5% from Discover may go a longer way for you as a rewards card.
Note that with the Chase Freedom card, the extra 2% you earn on your top 3 spending categories maxes out at $600 net spending per month. Also, if you also have a Chase checking account, the 3% rate gets applied to your top 5 spending categories. I use an American Express Blue Cash card for groceries, gas and drug store purchases only and get 5% cash back, then use the Chase Freedom card for most everything else.
Keep an eye out for banks introducing fees for low balances. I was informed by my friendly bank teller that some banks will be charging their customers if they have no or too small of a balance. Keep an eye peeled on your next statement.
There are actually a couple of different Chase Freedom cards. I know this because of when the $50 “bonus” for cashing in $200 reported went away in July, I called in a huff, wanting to know why I wasn’t notified. I was told that certain accounts were undergoing changes, but mine and others were not. The $30 fee after the first year is true, though. Honestly, I haven’t really minded. I received ~$1K from having my card one year so far.
So perhaps for some cards you need a checking account also. I have not seen my rewards “tap out” at any particular amount.