I received some good news by email yesterday – I have been approved for the American Airlines credit cards with the fantastic 35,000 miles sign-up bonus!
I was a little worried, to be honest, since my BMI MasterCard has a substantial £20,000 credit limit, and I wasn’t sure that MBNA would want to extend me more credit.
However, I have been an excellent MBNA customer over the years and presumably come out quite highly on their ‘people we want to keep as customers’ scoring. This clearly worked in my favour, and they have given me the card with a £10,000 credit limit.
The one downside of this card is the requirement to spend £5,000 within 180 days to trigger the full 35,000 mile bonus. Because you get a Visa card as well as an Amex, this is less difficult than it could be, especially if you can pay the Inland Revenue, your council tax etc with it. It is still not an easy target for many, though.
There is, however, a work-around.
When I wrote about the card, I didn’t mention one additional benefit that comes with it: you get 0% credit for 12 months (from account opening) on all flights bought from the American Airlines website.
You could, therefore, buy a £5,000 fully refundable flight on the AA website.
We don’t yet know how long it will take MBNA to send over the bonus miles. However, because of the 12 months interest free credit, it doesn’t matter. Wait as long as it takes, then cancel the flight and extinguish your card liability.
Note that, whilst the purchase will accumulate no interest, you still have to make the minimum 3% repayment each month. MBNA will want £15 off you, which will of course in turn reduce your outstanding balance.
When you trigger the refund, MBNA will not reclaim the base miles from your AA account. They will, however, send your internal MBNA account into negative territory, and you will not any further AA miles until you have earned enough to wipe out the deficit. This deficit would be 7,500 miles if you used the Amex card or 3,750 miles if you spend the £5,000 on the Visa card.
To avoid MBNA putting a black mark against your name for future applications, I would strongly recommend wiping out this negative balance by putting £5,000 of fresh spend through the card before you cancel it. Closing the account with a negative mileage balance is possible – and MBNA will not come after you for the value of the negative miles balance – but you shouldn’t be surprised if they don’t rush to offer you new cards in the future ….
Without stating the obvious, be sure that you are 110% certain that the flight you are booking on the AA website is fully refundable. If you are not sure, do NOT go ahead! Personally, I have a tax bill due at the end of July which I am going to pay early, so I will not be doing this myself.
Want to earn more points from credit cards? – January 2021 update
If you are looking to apply for a new credit or charge card, here are our January 2021 recommendations based on the current sign-up bonus.
British Airways American Express
5,000 Avios for signing up, no annual fee and a companion voucher for spending £20,000 Read our full review
British Airways American Express Premium Plus
25,000 Avios and the UK’s most valuable credit card perk – the 2-4-1 companion voucher Read our full review
American Express Preferred Rewards Gold
Your best beginner’s card – 20,000 points, FREE for a year & two airport lounge passes Read our full review
The Platinum Card from American Express
30,000 points and an unbeatable set of travel benefits – for a fee Read our full review
Virgin Atlantic Reward+ Mastercard
15,000 points bonus and the most generous non-Amex for day to day spending Read our full review
Earning miles and points from small business cards
If you are a sole trader or run a small company, you may also want to check out these:
American Express Business Gold
20,000 points sign-up bonus and free for a year Read our full review
American Express Business Platinum
40,000 points sign-up bonus and a long list of travel benefits Read our full review
British Airways Accelerating Business American Express
Earn both Avios and BA On Business points with your business spending Read our full review
Capital On Tap Business Rewards Visa
The most generous Avios Visa or Mastercard for a limited company Read our full review
Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history. By recommending credit cards on this site, I am – technically – acting as a credit broker. Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.