Posted by William Charles on July 5, 2016
Credit Card Benefits

Published on July 5th, 2016 | by William Charles

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New Rules Surrounding Citi, Downgrades & Annual Fees

In our post on annual fee refund rules for each card issuer, we’ve listed Citi as refunding annual fees as long as the card is downgraded or canceled within 30 days of the annual fee posting (and a prorated refund after that). It seems that the way that downgrades are handled by Citi is affecting how these annual fee refunds are also handled. Reddit user mk712 reports the following situation:

  • Annual fee on Citi Premier was charged on May 6th
  • Downgraded to a no annual fee card
  • On May 11th received a letter confirming this change and starting that they would receive the new card by the end of May, but the new terms on the card would only start applying on June 30th
  • Received annual fee refund of $79.16 on July 4th (10 month prorated refund instead of full refund)

There are also the following data points that match up with this: 1, 2, 3, 4, 5. This isn’t really a change to how Citi handles annual fee refunds, but a change to how they handle product downgrades. This makes downgrading a card with an annual fee difficult/impossible if you want the full refund, as the card must be opened for 12 months before requesting a downgrade/product change.

Just something to keep in mind, as always keeping good records will help in terms of knowing when annual fees become due. It might be possible to fight this with Citi and get the full refund (or you product changed completed sooner). Hopefully this isn’t a sign that Citi will do away with prorated annual fee refunds, like American Express recently announced.

It’s also possible that the botched Costco credit card transfer from American Express are causing product changes to happen slower than usual and business will return to normal once Citi finally works this out.

 



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Josh
Josh

The pro-rated AF has been happening to me for a couple years now. A frontline phone rep will usually fix it quickly.

I always convert to Dividend and the wait time is consistently 45 days. I’ve never had the card come before the actual conversion though.

Jay
Jay

This situation happened to me a year or two ago too. When I called in and explained the situation, the frontline rep immediately refunded the difference.

Brad
Brad

Okay so this definitely begs the question…. Does this apply in any way to CitiGold downgrades that have been suggested here and many other places?

Chuck

Citigold checking downgrade is unrelated. That fee hits at the end of each month.

Sarah
Sarah

This could indirectly affect my CitiGold account. After filing a CFPB complaint I should receive 50k TYP for my CitiGold checking account by 7/31. I have a Citi ThankYou Preferred card that I opened last July, so the AF should be posting soon. I think you need to have an active TYP-earning card open in order to receive the CitiGold bonus, so I need to wait until that posts before downgrading my credit card. It could come down to the wire, and I may end up eating $10.

joe
joe

I have not had any of these issues. I recently downgraded from Premier to Dividend. I got my AF refunded in ~2 days I received my refund in mid June. Although I technically don’t get the new Dividend card for ~40+ days.

Henri123
Henri123

I was able get my annual fee reimbursed after I downgraded my premier card to prefer 3 days ago. And the credit posted today for the full amount of $95.

Mike
Mike

Can we have multiple dividend cards? I will convert a couple more then, just got my first one from a conversion.

Drew
Drew

My experience:

10/12: called in to downgrade Premier to Dividend. Agent said she was able to issue full-refund “courtesy” credit for $95 AF that had posted

10/14: full AF refund posted as “REFUND MEMBERSHIP FEE”

Sarah M.
Sarah M.

Another data point: $95 annual fee posted to Citi AA card. Called a few days later to downgrade. Within a week the full $95 refund posted, backdated to the same day the annual fee originally posted.

TanT
TanT

I was charged the pro-rated fee. $95 fee for AA posted 2/21, called in to downgrade to Dividend. I had to wait until 4/15 to get downgraded. The annual fee just posted but backdated back to 2/21 in the amount of $79.16. Sent a secure message inquiring this and this is the response

“We’ve determined that your account is not eligible for a credit of the
annual membership fee.

In order to keep your account open, it is necessary to pay the annual
membership fee

Your Card Agreement states that this fee is non-refundable unless you
notify us to close your account within 30 days from the mailing or
delivery date of the statement on which the fee appears.

When an account is closed or converted to a different account type, the
annual membership fee will be reviewed and systemically adjusted if
appropriate. ”

Should I call in? I hate that Citi requires a long time to downgrade a card and then charge me for that waiting.

MarcoPolo
MarcoPolo

DP:
Just converted my Citi AAdvantage card to Citi dividend card after AF hit 14 days ago. The CSR confirmed that the AF of $95 will be refunded in full. So, YMMV
Will update if something changes.

abmo
abmo

any update?

Gadget
Gadget

+1. CSR confirmed when I called to PC that AF would be fully refunded, not prorated. AF was refunded directly back to my card approximately a week after my future PC from T/Y Premier to Citi Dividend. Well, technically, it was never refunded, the balance freaking disappeared. (Stupid online access does not show the date fee was refunded/eradicated, but it is 0 balance. Says a statement ended with $0 balance 1/08/19, but I have no record of it in online statements)

12/10/18 Statement closed, AF fee assessed
12/11/18 Called to convert T/Y Premier to Citi Dividend
Fee disappears a week later.
Still waiting on new card, supposedly converting 1/31.

William Charles I believe this is old news and Citi doesn’t prorate anymore, if you call right after AF posts, even if conversion takes awhile. Unless maybe it’s card family specific, but that isn’t logical either, but this is Citi we are talking about.

Andy Hough

They are still prorating annual fee refunds. I downgraded my Thank You Premier to a Rewards Plus on 1/16/19. The refund wasn’t processed until 3/18/19 and I was given a prorated refund of $79.16. I was also refunded $1.xx in interest. I’m guessing that was the interest that was charged on the annual fee pending the refund. I contacted them through chat and was told I would have to call to get the rest refunded. Chat said they would give me 3000 TY points for the trouble. I’ll update in a week or so after I call them and see if the points actually show up in my account.

Chuck

Andy Hough can you clarify something for me: when did the annual fee initially post? Was your downgrade in mid-year or was your downgrade within 30 or 60 days from when the fee posted? Thanks

Andy Hough

It was within 30 days off the annual fee posting. I think it was just 2 or 3 days after. I did receive the promised 3000 TY points for not getting the full annual fee refunded. When I called to get the rest of the annual fee refunded, I was put on hold while the agent contacted a specialist. After about 5 minutes of holding the call disconnected. Since the TY points are worth more than the missing part of the annual fee I decided to not pursue the refund further. Perhaps it will still show up when my next statement closes.

Mimi
Mimi

Another change I noticed that started last week of Feb, 2019 is with my double cash account. When I pay posted balance in full in the past, my current available balance went up immediately to reflect the amount I paid. Since last week of Feb, it takes weeks after full payment before my full CL is restored. Initially, I thought it was a sign of forthcoming shutdown so I waited till statement generated and I ACH’d my CB. No other changes and my 3 accounts remain active.

GT
GT

Called in to product change my Citi AA Platinum to Rewards+ on 3/28/19 after the annual fee hit on 3/25/19.
Received a new Rewards+ card in the mail last week. No change in 16-digit credit card number.
CSR confirmed that the annual fee would be refunded in full; credit received last week as well.
CSR also told me that I have until 5/17/19 to reverse the product change.

Christian R
Christian R

Wanted to help provide a useful datapoint: I applied for the Citi AA card in April 2018 and the annual fee hit at the end of May 2019. I called in the next day about downgrading the card and then a week later I received the full refund for the annual fee.

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