A PSA On Downgrading To A No-Fee Citi Credit Card

I, like many of you, downgrade most of my annual fee cards to a no annual fee version when the first annual fee comes due. That is because I want to keep the card and account active to increase my average age of account and also to make sure I am not resetting the clock on when a bonus can be earned from that bank again. However, I recently ran in to an interesting issue with Citi that I thought I would share with you.

A while back, there was a loophole wherein you could get the Citi AAdvantage Platinum card bonus numerous times despite language stating the bonus was only available if you had not received a bonus on that card within the last 24 months. The loophole worked because Citi was viewing the World and World Elite cards as separate products and was issuing the World cards to start, and then upgrading people to the World Elite card shortly after.

I took AAdvantage (I know, I know – but I had to) of this loophole and exploited it for a hefty 150k AAdvantage miles. My last Citi AAdvantage Platinum card was coming up on it’s annual fee, so as I usually do, I called in to Citi to downgrade the card to the no fee Bronze version. I prefer to downgrade this card rather than to cancel it entirely as Citi’s terms and conditions state that the 24 month clock to earn another bonus on this product starts to run either from the time you first received the card, or from the time you cancel the card. That means that canceling the card would have reset the clock to zero and effectively would have given me another year before I could earn a bonus on this card again.

After going through the usual disclosures, I was told that my new Bronze card would be shipped in January and that I had until early January to call and have them cancel the downgrade. At no time did the agent mention that my annual fee on my Platinum card would remain due and then be refunded after the new card was issued in January. About a week after I had called to downgrade, my account still reflected the $95 annual fee. I secure messaged Citi and was informed that my $95 annual fee was still showing as due and owing.

I ended up calling Citi to find out what was going on and was informed that since my Platinum card would not be physically downgraded to Bronze until January, that my $95 annual fee was still due, but would be refunded once the card was downgraded in ~2 months. I of course said that was ridiculous and was told this was due to “banking laws,” which was interesting as I had done the very same downgrade with 2 other Platinum cards. Thankfully, the agents are able to request an immediate annual fee waiver on a card, so I requested that this be done on my account. So for any of you other there that have Citi cards and plan on downgrading those cards to the no annual fee versions, keep two options in mind:

  1. Call at least 2 months prior to your annual fee hitting to downgrade your card so that you do not get hit with this issue like I did.
  2. If you are inside the 2 month time frame, request at the time of downgrading that they waive the annual fee immediately.

Final Thoughts

Citi has largely become my least favorite bank to deal with as their customer service is complete garbage. I find it interesting that they have tried to claim this is required by “banking laws,” yet no other bank I have downgraded cards with has ever done this. That makes me think this is just Citi’s shady way of getting you to pay your annual fee and hopefully forget about it. Bottom line, it pays to stay on stop of these things!

Have any of you encountered this issue with Citi?

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2 thoughts on “A PSA On Downgrading To A No-Fee Citi Credit Card

    1. There’s a lot of speculation on this and a lot of contradictory information on this out there. From what I have seen and read, it appears that a product downgrade to a similar card (i.e., from AAdvantage Platinum to AAdvantage Bronze) does not count as closing the account. But a product change (i.e., from AAdvantage Platinum to Citi Double Cash (assuming you could even do this)) would count as closing the account. I have also seen people opining that a product downgrade would still count as an account closure though I think this depends heavily on how Citi defines “close” as it relates to accounts. Without that clarification, it is entirely possible that Citi decides 12 months down the road that “close” includes downgrading accounts.

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