7 Critical Mistakes To Avoid When Downgrading Your Chase Sapphire Preferred Card In 2025

The decision to downgrade your Chase Sapphire Preferred (CSP) card is a financial rite of passage for many savvy travel hackers, especially as annual fees loom. While the $95 annual fee is modest for the value, a "product change" (the official term for a downgrade) to a no-annual-fee card is the perfect strategy to preserve your credit history, keep your valuable Ultimate Rewards (UR) points safe, and avoid unnecessary costs. This guide, updated for the current rules and policy shifts expected in 2025, walks you through the exact steps and pitfalls to ensure you protect your points and your credit score. As of December 14, 2025, the landscape of Chase Sapphire card ownership is seeing major shifts, including a critical change coming in June 2025 that affects bonus eligibility for the Sapphire family. Understanding these new rules is essential before you make any product change, as a poorly timed move could cost you thousands of points in future bonuses. The key is to switch to a card that still earns Ultimate Rewards, allowing you to retain all the points you've earned.

The Ultimate Downgrade Path: Best No-Annual-Fee Options

When you decide to downgrade your Chase Sapphire Preferred, you are performing a "product change" (PC). This process allows you to switch to another Chase card product without submitting a new application, which means no hard credit inquiry and no impact on the age of your credit account. Crucially, you must switch to a card that is a part of the Ultimate Rewards family to keep your points. The best and most common options for downgrading your CSP are no-annual-fee cards that still earn Ultimate Rewards (UR) points:

• Chase Freedom Flex℠: This is arguably the most popular downgrade choice. It offers 5% cash back on up to $1,500 in combined purchases in rotating quarterly bonus categories (like gas stations, grocery stores, or PayPal), 5% on travel purchased through Chase Ultimate Rewards, 3% on dining, and 3% at drugstores.
• Chase Freedom Unlimited®: A fantastic option for everyday spending, this card offers 5% on travel purchased through Chase Ultimate Rewards, 3% on dining, 3% at drugstores, and a flat 1.5% cash back on all other purchases.
• Chase Freedom (Original Visa): Often referred to as the "OG Freedom," this discontinued card is still available as a product change option. It also features 5% rotating categories, but unlike the Freedom Flex, it is a Visa card, which can be beneficial for specific merchants like Costco that only accept Visa.
• Chase Sapphire Card (No-Annual-Fee): This is an older, no-annual-fee version of the Sapphire card that is not available for new applications but is sometimes offered as a downgrade path. While it retains the "Sapphire" branding, its earning rates are minimal (often 1 point per $2 spent). Most experts recommend the Freedom cards for superior earning potential.

Expert Tip: If you already hold the Chase Freedom Flex and Freedom Unlimited, you can downgrade your CSP to a *second* Freedom Flex or Freedom Unlimited. This is a powerful strategy to double up on the 5% rotating categories (with the Flex) or simply hold another no-annual-fee card.

7 Critical Mistakes to AVOID During Your CSP Downgrade

A product change is straightforward, but making any of these seven mistakes can have severe consequences for your points balance or future bonus eligibility.

1. Downgrading Before the 12-Month Mark

You are legally required to hold a credit card for at least one year before you can product change it to another card with a lower or no annual fee. Attempting a downgrade before the 12-month anniversary of your account opening will be rejected by Chase. Always wait until the 13th month to initiate the process.

2. Canceling the Card Instead of Downgrading

This is the most detrimental mistake. Canceling your Chase Sapphire Preferred means you forfeit the entire credit line associated with the account, which can instantly lower your available credit and increase your credit utilization ratio. A higher utilization ratio can negatively impact your credit score. Furthermore, canceling the card will eliminate the account's history from your credit report, shortening the average age of your accounts over time. Downgrading avoids all these negative credit score impacts.

3. Downgrading Without Another Premium Card

Your Ultimate Rewards points are safe when you downgrade to a no-annual-fee Freedom card, but they lose their *transferability* to Chase's airline and hotel partners (like United, Hyatt, and Southwest). The ability to transfer points at a 1:1 ratio is what makes the UR program so valuable.

To retain this premium feature, you must hold another card that allows transfers, such as the Chase Sapphire Reserve® or a Chase Ink Business Preferred® Credit Card. If you don't hold one of these, your points will be stuck at a lower redemption value (typically 1 cent per point for cash back).

4. Forgetting to Redeem or Transfer Your Points First

While your points are technically safe on a downgraded card, it is best practice to move your points to another premium UR card (like the Chase Sapphire Reserve) *before* you initiate the product change. This ensures your points are immediately accessible for travel transfers and redemptions at the highest value.

5. Missing the Annual Fee Refund Window

The best time to downgrade is *after* your annual fee posts to your statement, but *before* the 30-day window closes. Chase will typically refund the full annual fee if you perform a product change within 30 days of the fee being charged to your account. If you wait too long, you may only receive a prorated refund, or no refund at all.

6. Ignoring the New Sapphire Bonus Rules (Starting June 2025)

A major policy change is coming: starting June 23, 2025, you will be able to hold both the Chase Sapphire Reserve and the Chase Sapphire Preferred simultaneously. However, the eligibility for the sign-up bonus on *each* card will be affected. If you are planning to eventually re-apply for a Sapphire card to earn a new bonus, you must be aware of the 48-month rule (you can only earn a Sapphire bonus once every 48 months) and how holding or downgrading a card affects your eligibility for a future bonus. Consult the most current Chase rules before making a move that could block a future bonus.

7. Downgrading to a Card You Already Hold

While you *can* hold multiple copies of the Freedom cards (Flex or Unlimited), it's generally recommended to diversify your card portfolio unless you have a specific strategy for doubling up on 5% categories. If you already have a Freedom Unlimited, consider the Freedom Flex to maximize your earning potential across different categories.

The Step-by-Step Chase Sapphire Preferred Downgrade Process

The process for a product change is simple but requires a direct conversation with a Chase representative.

1. Confirm Timing and Points

Ensure you have held the CSP for at least 12 months, and ideally, wait until the annual fee posts to your account. Move all your Ultimate Rewards points to another premium UR card (like the Chase Sapphire Reserve) or redeem them for maximum value.

2. Contact Chase Directly

You can initiate the product change by calling the number on the back of your Chase Sapphire Preferred card.

What to Say: "I would like to perform a product change (PC) on my Chase Sapphire Preferred account. I want to switch it to the [Chase Freedom Flex/Unlimited/Original Freedom] to avoid the annual fee."

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3. Wait for Confirmation

The representative will confirm your eligibility and process the change. They will confirm the new card name, and your new card will arrive in the mail within 7-10 business days. Your account number will usually remain the same, but the card's benefits and earning structure will be immediately converted to the new product.

4. Check Your Credit Report

After a month, check your credit report to confirm the account is still open with the original opening date and the same credit limit. This confirms the successful product change and the preservation of your credit history.

By following this strategy—downgrading instead of canceling, preserving your credit history, and protecting your valuable Ultimate Rewards points—you can successfully transition from the Chase Sapphire Preferred to a no-annual-fee card while keeping your options open for the next big sign-up bonus.