Whether you’re interested in switching credit cards because you found one with better rewards or due to another reason, such as wanting to change to an option with no annual fee, it can make sense to do so. Also called a credit card product change, some banks allow you to make a switch without much consequence.
But before doing so, it’s best to understand how changing credit cards works and how to switch credit cards properly.
What Is a Credit Card Product Change?
A credit card product change is where a cardholder switches from one credit card to another credit card offered by the same bank or issuer. Because each credit card offered by an issuer is referred to as a different product, a product change is simply switching credit cards.
In theory, switching credit cards within the same bank won’t affect your credit as you’re not applying for a new credit card. Typically, your credit limit will stay the same for your new card as it was for your previous card.
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How Does a Credit Card Product Change Work?
When you undergo a product change, you’re not canceling a credit card. Rather, you’re either making a switch to an equivalent credit card, upgrading to a card with more benefits, or downgrading to a card with fewer benefits. In many cases, your bank may send you targeted offers for different credit cards, and you may be able to switch to one of these credit cards.
Once you switch credit cards, you’ll no longer be able to use the credit card you previously had and can start using the new credit card instead. Features and benefits will most likely differ, and in some cases, so may your credit limit.
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Rules for Credit Card Product Changes
When it comes to following the credit card rules, each credit card issuer will have its own rules regarding product changes. For instance, some won’t allow you to change to certain credit cards, while others may allow a product change only if you’re switching to a similar type of card.
In general, though, there are some rules that are usually the same across the board. For one, cardholders can’t switch from a business credit card to a personal one and vice versa, since these are considered different classes of cards and may have different credit limits.
Additionally, issuers typically only let you change credit cards as long as they’re within the same family of cards, as this can impact how credit cards work. However, each issuer has a different definition of what that means.
For instance, if you have a travel rewards credit card and the bank offers two other cards that use the same travel portal to redeem points, all of those cards could be considered in the same family. Or, if you have a co-branded card with an airline, other co-branded cards with that airline may also count as within the same family of cards.
Unfortunately, it’s not easy to find information about whether you can switch your specific credit card to another. Even if you can find details from another bank, your card may not have the same rules and processes. Your best bet is to call your credit card issuer and ask them directly.
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Pros and Cons to Switching Credit Cards
There are certainly upsides to converting credit cards rather than closing out your account and starting over. However, there are downsides to take into account as well.
|Pros of Switching Credit Cards||Cons of Switching Credit Cards|
|Generally won’t affect your credit score if the bank doesn’t conduct a hard credit inquiry||Not easy to find definitive information online about product change rules|
|Possible to get more benefits with the new card you switch to||May not be able to switch to your preferred card, depending on issuer’s rules|
|Won’t need to submit a new credit application||May lose existing credit card rewards or points|
Guide to Switching Credit Cards
Switching credit cards can be a relative straightforward process, but it does involve contacting your bank or credit card issuer. Here are some best practices to keep in mind before making the switch.
Decide Which Card You Want
You want to make sure your new card will be a good fit for you. Before making moves to change your credit card, check your bank’s website to see what other products are currently on offer. In some cases, you may find that you’ll get upgrade offers in the mail or after logging into your bank account online.
Contact Your Bank or Credit Card Issuer
You’ll also want to contact your bank to ask whether you can switch to the card you’ve decided on. If you can get the credit card you want, ask the bank what else you’ll need to do before you can officially make the switch.
You’ll also want to ask about certain features and benefits you’ll receive if you do decide to change credit cards. Specifically, make sure to ask about the following:
• Whether your credit limit will remain the same after switching cards
• If you need to pay off the balance before switching
• Whether you’ll be subject to a hard credit inquiry
• Whether you can keep existing rewards you’ve earned with your current credit card
• What your new APR will
• If you’re eligible for credit card bonuses with the new card
Learning these answers will help you to make an informed decision and avoid getting caught off guard after making the switch. You may even be able to negotiate for things like bonuses or perks that you may not have gotten otherwise.
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Effects of a Product Change on Your Credit Score
It’s important to determine whether switching credit cards will have an adverse effect on your credit score. When it comes to your credit utilization, as long as you’ll have the same credit limit with your new card, you should be able to maintain it. This is unlike closing a credit card, where you’ll lose that credit limit, which could result in an increased credit utilization ratio and a negative impact to your credit score.
In some cases, your card issuer may require a hard credit pull before allowing you to switch credit cards, which could temporarily ding your credit score. Your issuer may make this request for a variety of reasons, including to ensure your credit profile is still good and to determine whether to continue offering you the same amount of credit (especially if you tend to max out your card). You’ll be asked permission before the hard inquiry is conducted, so you’ll know it’s coming.
Effects of a Product Change on Your Credit Card Rewards
Depending on what card you want to switch to, you may be able to keep your existing credit card rewards. For instance, if you’re switching to a credit card that has the same rewards structure or program, you’ll probably be able to keep the points or miles you’ve earned.
However, if you’re going from a travel rewards card to a cash back program, for instance, your bank may not allow you to keep your existing rewards. That means you’ll have to use up your rewards or forfeit them, though it may still be worth speaking with a customer representative to see what they can do.
If you want to get sign-up bonuses on a credit card that you plan on switching to, check with your bank to see whether you’re eligible. Some cards don’t allow bonuses for existing customers.
Requesting a credit card product change can be an easy way to switch to a new credit card without going through the full application process. Before you make any moves, however, take the time to confirm whether or not converting credit cards will impact your credit and whether you’ll be able to keep the rewards you’ve earned using your existing credit cards. After all, valuable credit card rewards aren’t something you want to lose out on.
If you’re on the search for a rewards card, you might look to get a credit card with SoFi. The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.1
Does a product change reduce your credit score?
A credit card product change may affect your credit score if your issuer requires a hard credit inquiry to make the switch. This should only impact your score temporarily though.
How do I request a product change?
To switch credit cards, you’ll need to contact your bank or credit card issuer to determine whether you can switch the card you want. From there, it will inform you of the other steps you need to take.
What are the downsides of a credit card product change?
You may lose the rewards you’ve earned on your current card if you decide to switch credit cards. Your credit score could also be temporarily affected if your issuer conducts a hard credit check when you switch cards.
Photo credit: iStock/RgStudio
1Members earn 2 rewards points for every dollar spent on eligible purchases. If you elect to redeem points for cash deposited into your SoFi Checking or Savings account, SoFi Money® account, or fractional shares in your SoFi Active Invest account, or as a payment to your SoFi Personal, Private Student, or Student Loan Refinance, your points will redeem at a rate of 1 cent per every point. If you elect to redeem points as a statement credit to your SoFi Credit Card account, your points will redeem at a rate of 0.5 cents per every point. For more details please visit SoFi.com/card/rewards. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.
1See Rewards Details at SoFi.com/card/rewards.
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