Be VERY careful if you choose to use the [targeted] Delta / Amex – “Fly Now, Earn Later”

A bunch of folks have been blogging recently about the new targeted Delta / Amex – “Fly Now, Earn Later” program, including BoardingAreas Caroline Lupini, and I wanted to get out a post warning you to be EXCEEDINGLY careful if you choose to use this. First what it is and how to find it (if you are targeted that is).

As you can see from the big red arrows above you simply log in and go to your benefits page (or use this link once you are logged in). Then you can see if you are targeted and how much Amex is willing to allow you to borrow for 6 months. The Amex T&C are extensive you are agreeing to. They are:

“Fly Now, Earn Later
Eligible Delta SkyMiles Credit Card Members must be in good standing to access Fly Now, Earn Later. If you qualify to access Fly Now, Earn Later, the maximum number of miles you can borrow is based on several factors including Card activity. You may have only one (1) Fly Now, Earn Later Balance outstanding at any time. The Fly Now, Earn Later Start Date is defined as the date that borrowed miles are posted to your Delta SkyMiles account. The Fly Now, Earn Later End Date is defined as the last day of the sixth full billing period following the Start Date. If, on the End Date, there are miles remaining in your Fly Now, Earn Later Balance, then your Card account will be charged for those remaining miles at a rate of $0.025 per mile. If you do not see the borrowed miles posted to your Delta SkyMiles account immediately, please allow up to 72 hours. Any miles borrowed cannot be returned or transferred and are subject to Delta SkyMiles terms and conditions. See full program rules.

Earning and Purchasing of Miles
When you activate Fly Now, Earn Later on your Card, your Fly Now, Earn Later Balance is equal to the total number of miles borrowed. As you earn, receive, or are awarded miles on your Card, those miles are automatically applied to your Fly Now, Earn Later Balance and will decrease the Fly Now, Earn Later Balance amount. Miles applied to your Fly Now, Earn Later Balance include (1) miles earned through spending on eligible purchases on your Card, (2) Bonus miles that may be awarded through Miles Boost or other promotions, and (3) miles that may be received from goodwill adjustments or reinstatements. Eligible purchases mean purchases for goods and services minus returns and other credits. Eligible purchases do NOT include fees or interest charges, balance transfers (balance transfers are not available on Delta SkyMiles Business Credit Cards), cash advances, purchases or reloading of prepaid cards, or purchases of other cash equivalents. Only miles earned, awarded, or received on the Card you selected for Fly Now, Earn Later will be applied to your Fly Now, Earn Later Balance. Your Fly Now, Earn Later Balance will be updated each billing period to reflect miles earned, awarded, and received during that billing period. You can view your Fly Now, Earn Later Balance online. If, on the End Date, the miles earned, received or awarded to your Fly Now, Earn Later Balance equal or exceed the number of miles borrowed, there will be no charge for borrowed miles. If, on the End Date, there are miles remaining in your Fly Now, Earn Later Balance, your Card account will be charged for those remaining miles at a rate of $0.025 per mile. You will not earn miles on this charge. American Express reserves the right to change, modify or revoke the terms of this offer at any time without notice. If your Card account is cancelled anytime between the Start Date and the End Date, any miles remaining in your Fly Now, Earn Later Balance at the time of cancellation will be charged to your Card account at a rate of $0.025 per mile. If your Card Account enters bankruptcy status or hardship status anytime between the Start Date and the End Date, any miles remaining in your Fly Now, Earn Later Balance at that time will be charged to the Card account at a rate of $0.025 per mile.”

Once you have clicked the box to accept the terms you are presented with a box warning you that it can take up to 72 hours for your loaned SkyMiles to appear. With Amex Membership Rewards transfers they tend to be almost instant.

In my test of 100 SkyMiles I found the transfer to be just about instant as well. I have no worries earning 100 SkyMiles on my card even though I do not really use the card anymore (this year) since I have already spent $60,000 and can earn no more MQMs that I value much more than SkyMiles.

Now the warnings. What you can spend to earn SkyMiles very much mirrors what the normal wording tells us. Does that mean “creative” spending will backfire? Maybe, but I doubt it. Then again they may shut down those who abuse this and then bill them the 2.5 cents for each SkyMile you borrowed.

Even if you are simply borrowing for some trip you want to book RIGHT NOW you must be so very careful with this. SkyMiles are in no way worth 2.5 cents each. At the least they are worth 1 cent each and for some 1.5-2 cents each. Please, I beg you, do not forget about this points loan and allow Amex to bill you at the 2.5 cent rate!

Flexibly is good but unless you are talking a manageable amount of SkyMiles to loan I would stay far away from this program. – René