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What Are Pre-Approved Credit Card Offers?
While the plethora of envelopes splashed with “limited time” and “apply now” might be annoying, there are a few reasons you might NOT want to toss them out.
Credit card companies regularly ask credit bureaus for the names of people who meet a certain set of credit criteria.
If you’re on the list (And you can be added), a credit card company might assume you’re a good borrower and send you a pre-approved credit card offer (also known as a pre-qualified or pre-screened offer) to encourage you to apply.
Receiving one of these mail offers may indicate you’ve passed certain requirements set by the card issuer and/or lender (which is possible even if you have “bad credit”). A pre-approved offer does not guarantee you will be approved if you apply. Do not dread Keep reading to see why
Do Pre-Approved Credit Card Offers Hurt My Credit?
No need to worry: pre-approved credit card offers don’t hurt your credit.
Credit card companies make these offers after performing a soft pull — which, unlike hard inquiries, have no effect on your credit scores.
That being said, taking the next step and applying for a credit card — whether you’re pre-qualified or not — will trigger a hard inquiry.
Though this will have a slight negative effect on your credit scores, it will be temporary (and not a cause for great concern, unless you have more than about five on your credit reports).
Benefits of Pre-Approved Credit Offers
Now you know what all those pre-approved credit card offers are doing in your mailbox — but is there any reason you shouldn’t throw them out?
Yes! Here are two benefits to consider:
You Could Reduce the Impact on Your Credit
Every time you apply for a credit card, the issuer runs a hard inquiry on your credit reports.
So, rather than applying for several different cards — and getting several hard inquiries — you can simply apply to one card: the one you’re pre-approved for. Though there’s no guarantee you’ll get approved, your odds are much better than with a randomly selected card.
You Could Land Better Terms
Another advantage of pre-approved credit card offers is they can, in many cases, include better terms than those available to the general public.
The credit card company gives these to you — a seemingly creditworthy customer — to entice you to apply.
Such enhanced terms might include:
1. Better rewards program or signup bonus (more points or cash back for spending a certain amount)
2. Reduced intro APR on purchases or balance transfers for a limited time
Credit card issuers have bothd private offers. Public offers are available to the general public, and are usually the offers advertised on issuer websites. Private offers are customized for and only available to specific people based on their credit histories and other criteria. One person’s private offer will not necessarily be available to someone else.
This is an example of a public offer on the American Express website. Here >>
Here’s an example of a private offer, with an introductory bonus that’s twice as big.
Can You Get Denied When Applying?
Even after you get a pre-approval letter, you’ll still need to complete the regular credit card application process. Unfortunately, pre-approval doesn’t guarantee you’ll get the card.
One reason is that offers aren’t always based on your specific credit history.
To determine if an offer is tailored to you, look in the fine print: is there a “PRESCREEN AND OPT-OUT NOTICE”? OR The Offer Acceptance Code ?
If you don’t see that phrase, then the offer is generic and not based on your credit history. AND NOT A PRE-APPROVAL
If you see it, that means the credit card issuer has already checked your credit history — and can’t change the terms of the offer (unless your credit situation has changed dramatically since it was sent).
So, if you’re searching for a new credit card or think that one of your old ones could use an upgrade, take a few minutes to see what pre-qualified offers are available for you.
PRO TIP: Be aware if your credit changes after you receive a
pre-approval offer, you may no longer be eligible for the line of credit. Other, non-prescreened factors — like your income — may affect the decision, too. Long story short: if you apply for a card for which you received a pre-approved offer, you could still be denied.
How To Request Pre-Approved Credit Offers
What many people don’t know is we can actually request pre-qualification offers to get pre-approved -vs- guessing at it for you — you don’t need to wait for them to come to you.
It’s an easy process that only requires us submitting some of your personal information to the lenders and credit card issuers.
When we make your request, the issuer will do a soft credit check. Then, if you’re eligible (you'll need good tradelines), you’ll begin to receive and be able to view the credit cards and loans for which you’re pre-qualified.
Sometimes they’ll be the same offers available to the general public, but in many cases, you’ll find yourself getting bigger and better more personalized deals!!
Where to Find Your Pre-Approved Credit Card Offers
Ready to see which pre-approved credit card offers are available to you?
All you need to do is contact us to enter your name, street address, zip code, DOB and your CPN or Social.
Here are a few links to some financial institutions’ pre-approval forms below.
(PRO TIP: You'll need good lines-of-credit on your report to get offers)
Once you’ve seen which cards you qualify for, it’s time for the fun part: deciding which one you want to try and snag.
If you want to dig into the details of how issuers decide to approve or deny applications, take a look at this Credit Card Approval/Denial Reporting Mega Thread over at Reddit.
Where do you fall