Chase Sapphire Preferred Card Review (2019)
The Chase Sapphire Preferred card hit the ground running in 2019 with one of the most expensive marketing campaigns it could muster. They are paying affiliate fees out the nose, which is why the Chase Sapphire Preferred card appeared at the top of every credit card list in the beginning of 2019. I have even seen reviews where one credit card was being reviewed and they kept comparing it with the Chase Sapphire Preferred card just so that they could link to it with an affiliate link. The Chase Sapphire Preferred card is one of the most highly reviewed new credit cards in 2019, and yet it has some fundamental flaws.
The Chase Sapphire Preferred Card Has Its Faults
Online articles are reviewing the Chase Sapphire Preferred credit card so highly because they are getting paid large affiliate fees whenever people sign up. Is the Chase Sapphire Preferred card a bad card? No, it is an okay/average credit card, but it has a number of flaws that most online reviews do not mention, and the most ugly is their terrible customer support/service. The next most ugly downside is the company’s unclear terms and conditions where people are not receiving card benefits for reasons that are not easy to explain. Plus, the card seems to reject people who are debt free, which is a very sleazy policy for a major credit card company.
Clearing The Air
Do not dismiss this card just because we are the only ones willing to point out its flaws. Even the faultless credit cards that we review will often undergo policy changes after a year so that they become less-than-great. For example, we tested the Barclays Arrival Premier World Elite Mastercard and we thought it was one of the best credit cards ever for long-term users. They stopped offering it after just eight months, so there will never be any long-term users. It was taken off the market so quickly that we never had a chance to write up our findings. The point is that even the greatest credit cards will often disappoint in one way or another.
Credit cards do have a lot of genuinely helpful elements, but for most people they are debt traps, so let us not go into this review with the notion that a perfect credit card exists because it does not.
This is a review of the Chase Sapphire Preferred card. Now I have cleared the air as to how you cannot trust many online reviews, and how this card is not as “Perfect” as many online reviewers are making it seem, let’s get down to details to figure out if this card is the one for you. It may have its faults, but it is our experience that all credit cards have their faults.
Chase Sapphire Preferred Card Summary
Spend $400 within the first three months of having your card, and you get 50,000 bonus points, which comes as the amount of $625 towards travel if you redeem through the Chase Unlimited Rewards system that works with selected travel operators.
You get 2x points to put towards travel if you dine at restaurants, and the rate is 1 point per 1 dollar spent when you make regular purchases. There is a 1:1 point transfer rate if you wish to transfer your points to participating hotel and airline loyalty programs. If you wish to redeem your points with Chase, you will have to pick a participating travel company through the Chase Unlimited Rewards system. There are no blackout dates for when you spend your travel points.
The Chase Sapphire Preferred card doesn’t have foreign transaction fees, which is a benefit for people who travel a lot, but that doesn’t mean you are getting a good deal if you use your credit card overseas. You will still be stung with currency conversion fees, which Chase doesn’t make mention of until you have signed up and read their terms and conditions prior to signing your final agreement with the company. This is explained in full later in this article.
Chase Sapphire Preferred card Vital Statistics
Required Credit Rating – One researcher sneaked in with a 675 score, but you stand more chance with a 690 or more credit score.
Purchase Annual Percentage Rate (APR) – is as much as 29.99%. Though, you may receive rates of between 17.99% and 24.99% depending upon your creditworthiness.
Cash Advance APR – Starts at 26.99%, but may rise as high as 29.99%
Bonus Points – A starting bonus of 50,000 points is available for people who spend $4000 on purchases within the first three months of having the card.
Cash Value Of The Points – Your points are worth $0.0125 per point if redeemed for travel rewards. If you can redeem the cash value, for whatever reason, then they are worth $0.01 per point. That means 50,000 is worth $625 towards travel, or $500 if you are able to redeem as cash.
How to Avoid Paying Interest on Purchases – Pay off your balance between the 1st and 21st day after the close of your monthly billing cycle. This is not true of balance transfers and cash advances, as you pay interest on those every day you have a balance (i.e. every day that you owe money).
Annual Fee – $95 per year, and your first year is free.
Balance Transfers – $5 or 5% of the amount of each transfer.
Cash Advances – $10 or 5% of the amount of each transaction.
Foreign Transaction fees – $0.00, but there is a currency conversion fee of 3%.
Late Payment – Cost up to up to $38 per day.
Return Payment – Cost up to $38 per transaction.
Minimum Credit – $5000 (is the amount they gave our research team)
The “Free” (ahem) Foreign Transactions Selling Point
The Chase Sapphire Preferred card says that it doesn’t charge for foreign transactions, which is true, but you will still have to pay for converting your currency from US dollars to whatever currency you need. Even though you do not pay a fee for using your card overseas, or for buying from a company overseas, you are charged a conversion fee. It is not a fee in the strictest of definitions, what they do is give you their own rate for your currency conversions. You will not receive the market rate for your currency conversion, you will receive the rate that the credit card determines.
How You Are Charged For Currency Conversion
Let’s say that you wish to convert $100 USD into British Pounds (GBP). Let’s say the market rate is 0.79. This means if you convert $1, you get £0.79 in GBP. If you convert your $100, you get £79.00 back.
If your credit card charges a transaction fee, then a percentage of your $100 is taken away, and then your money is converted. E.g. a 3% transaction fee means you lose $3 from your original $100, you only convert $97, so you get £77 back.
However, there is also a currency conversion fee. Even if a card such as the Chase Sapphire card doesn’t have a transaction fee, it still has a currency conversion fee. This means instead of giving you a rate of 0.79 for your dollars, you get a lower rate such as 0.76. In this example, your $100 would only buy you £76. The difference (£79 – £76 = £3) is kept by the credit card company.
Visa And MasterCard
When you spend money in another country, either through being there, or buying online, your credit card may charge you a transaction fee and it may skim money from your transaction by offering you a less-than-the-market-rate conversion rate. Visa and Mastercard post their currency conversion rates online. At the moment, they add 1% onto your currency conversion. This means that all credit cards that are either Visa or MasterCard will charge you at least 1% to convert your money, and the Chase Sapphire Preferred card is a Visa card.
Credit cards do not typically post their conversion rates on the Internet, they tend to leave those sorts of details until you get the terms and conditions near the end of your application when you have nothing left to do but sign the final agreement. Here is the Visa conversion calculator and here is the MasterCard conversion calculator. At a bare minimum, your credit card has to charge at least whatever Visa or MasterCard are charging for converting (not transaction fees, these are conversion fees).
For example, if the rate for converting USD to GBP is 0.79, then MasterCard or Visa will give you a rate of 0.78, and if your credit card is a Visa or MasterCard, then your rate with Sapphire will be 0.78 or worse depending upon the policy of your credit card. For example, at the time of writing, the market rate for USD/GBP is 0.79, the Chase Sapphire Preferred card gives you 0.7663.
Comparing Costs For Travelers
Companies such as Transferwise and CurrencyFair will charge you a fee, but will not add any sort of currency conversion charge, which means you get the market rate. PayPal is an online wallet, and a truly fantastic payment system if you ask me, but they charge a small transaction fee and a currency conversion fee, so I have included them in my example.
Transaction Fees For Buying Overseas With $100
$0.00 Chase Sapphire Preferred card
Currency Conversion Fees For Buying Overseas With $100
$2.99 Chase Sapphire Preferred card
Total Amount Received When Buying Overseas With $100
$76.63 Chase Sapphire Preferred card
Results – Spending Overseas With A Credit Card Is Expensive
As you can see, you get more back if you use a currency conversion company like Transferwise, however a transfer company such as CurrencyFair isn’t as good value with smaller sums such as $100 because it has a flat rate, which means it is better to use a company like CurrencyFair if you are converting thousands.
As you can see, in the $100 example, you get the most money back with Transferwise, then PayPal, then Chase Sapphire, then CurrencyFair. Despite the fact that you are losing money if you use your Chase Sapphire card overseas, it is still better than 50% of other credit cards. We have seen credit cards that give you far less for your currency conversion.
The point I am making is that even though the Chase Sapphire Preferred card says it offers free overseas transactions, it doesn’t mean you are saving money because they will still skim from your currency conversion. That is why it is still better to use a transfer company such as Transferwise and CurrencyFair where you get the market rate for your conversion (i.e. the rate shown on Google and Bing).
To clarify, this isn’t a damning indictment of the Chase Sapphire Preferred card because most people know it is costly to use their credit card overseas, and the cost of using your Chase Sapphire Preferred card overseas is still not as costly as many other credit cards since many others skim from the rate and charge a transaction fee.
Chase Sapphire Preferred card Advantages
You are smart enough to see which are the advantages and disadvantages based on what you have read so far, but I thought I would offer a few thoughts since we at eCheck.org have reviewed a great many credit cards in our time, so we know which elements stand out when compared with many other credit cards.
A High Credit Limit For People With Okay Credit Scores
Our research team applied and received a $5000 credit limit, and after questioning, we were told that credit limits of $5000 were rather normal for this credit card. Most credit cards that accept people with credit scores in the region of 675+ or 690+ will typically only offer credit limits of around $1800 or maybe $2800. The Chase Sapphire Preferred credit card is slightly predatory in that they prefer people who already have debt, and they do not mind people with a credit score of under 700. Yet, one cannot deny that a $5000 is unusually good for a credit card from a mainstream bank.
The Introductory Offer Is Not Bad For People Who Like To Exploit Them
If you like to exploit credit card opening offers, and if you are suitably good at managing your financial affairs and credit score, then this credit card has a robust points offer and the first year’s fees are waived. You are not eligible for the bonus if you have received a starting bonus/ introductory bonus from any Sapphire card within the last 48 months. Beware that you can apply and you will receive card even if you do not qualify for the bonus.
No Blackout Dates Or Travel Restrictions
You are probably aware of some of the tricks of the trade by now, such as offering free travel, but only to places nobody wants to go, and only during the non-tourist seasons. The Chase Sapphire Preferred credit card doesn’t pull this stunt, if there is a flight available, then you are able to use your points as part of your payment. Another trick is to offer free travel benefits, but redeeming them is very difficult and/or there are very few travel companies participating. That is not the case with Chase Sapphire Preferred credit card since the Chase Unlimited Rewards system has a fair number of participants, so you will probably be able to find a suitable trip for you to use your points on.
Chase Sapphire Preferred card Downsides
Despite the fact that this article is not being paid for by Chase affiliate links (it is paid for by the adverts you see strewn around the page), I will admit that I haven’t really torn this card apart in terms of its downsides. I have made mention of the non-transparent currency conversion fees, and the fact that they are paying massive amounts to affiliate advertisers so that many online articles are overtly positive without good cause. Nevertheless, here are some of the Chase card’s downsides.
They Do Not Value Customer Loyalty
The biggest downside of the Chase Sapphire Preferred credit card and Chase’s lending department in general is that they do not respect customer loyalty. One of the biggest indicators of this is that they have a very large and enticing starter offer, but give very little to their loyal customers. There is nothing wrong with keeping the system going so that people may enjoy travel benefits, but the company hasn’t instigated such a scheme. What is more infuriating is that they will happily allow people to sign up for the card and do what it takes to earn the starting bonus, only to let them down and not credit the bonus because of the 48-month restriction for people who have received other Sapphire starting bonuses.
They Have Horrible Customer Service
Chase reminds me of a game developer called Bethesda. The Bethesda game developer created Fallout 76 in 2018, they created it quickly, they messed it up, and to cut a long story short, they screwed over the fans of their franchise with a shoddy game, terrible refund policies, rudeness, and poor quality merchandise. Yet, the company is so big that they publicly attacked their fans and critics when they said, “If you don’t like our game, don’t buy it.” They think they are too big to fail and too big to care. Chase is like that when it comes to customer service. They do not care if you are angered by their waiting times and low-quality call center staff because they know they have the marketing power to generate a fresh batch of paying customers to replace the angry ones.
What An Ugly Annual Fee
The card isn’t targeting big spenders, nor is it really a genuine travel credit card, so why the big ugly fee? The $95 per year fee is simply a cash grab for what is essentially a card aimed at people who can only just afford to go on vacation once per year. The Chase Sapphire Preferred credit card is not a predatory card, but its annual fee stinks of exploitation of a group of people who are teetering on the edge of a debt spiral. This card doesn’t have long-term or medium-term benefits, it just has an attractive starting bonus, so there is no reason why it should have an annual fee at all.
Conclusion – A Forgettable Card Suitable For Starter-Bonus Exploiters And People Planning A Vacation
The biggest problem this card has is that it has an annual fee of $95 despite the fact that it doesn’t offer any long-term or medium-term benefits for owning or using it. There are plenty of other credit cards on the market that are just as easy to get and that do not charge an annual fee. If you have control over your finances in a way that allows you to exploit starter bonuses while keeping track of which you have exploited recently, and while keeping your credit score in check, then you will get a great kick out of this card. It may also be suitable for people who are planning a vacation or two and would like to save a little money on their trip. Otherwise, even though it is not a bad credit card, the Chase Sapphire Preferred card is nothing to get excited about (even if other online articles are promoting it heavily).