What Are Pre-Approved Credit Card Offers?

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  • If you receive a “pre-approved” credit card offer in the mail, it means the issuer has reviewed your credit information and decided that you meet at least some of their approval criteria.
  • Pre-approved (also called “pre-screened” or “pre-selected”) and pre-qualified card offers both involve a screening process on the part of the lender.
  • You should only consider adding a new credit card to your wallet if it makes sense for your unique financial situation.

You’re sifting through a pile of mail and find a letter from a credit card company telling you that you’re pre-approved for a brand-new account. Is the offer trash or treasure?

First, there are some differences between the type of credit cards that you may receive in that pile of mail. It may be a bit confusing, but pre-approved credit card offers and pre-qualified credit card offers vary. Let’s discuss below.

What are pre-approved credit card offers?

Receiving a pre-approved credit card offer means the issuer has reviewed your credit information and decided that you meet at least some of their approval criteria.

The language may vary for pre-approved credit card offers. You may also see ‘you are pre-screened or pre-selected’.

A pre-approved offer typically means that a lender’s offer is a firm offer and will be honored if you continue to meet the terms of the account opening requirements.

Pre-approval criteria will vary from issuer to issuer. Some credit card companies may review your credit scores, while others might take a look at specific behaviors on your credit reports, such as your payment history.

Some pre-approved credit card offers might come with a special sign-up bonus. You may also be offered a lower introductory interest rate or other rewards that are not available to regular applicants.

How do you receive a pre-approved offer?

You may also be more likely to receive pre-approved offers from card issuers with which you already have a relationship. It may be initiated by the card issuer and you will likely not even know this screening is happening until you receive an offer in the mail.

Is a pre-qualified credit card offer the same thing?

Although pre-qualified credit card offers are similar to pre-approved offers, they are not quite the same thing. Pre-approved offers are pre-screened and provided without your engagement. Pre-qualified offers are typically initiated by the consumer and not the credit card company and may require your engagement and can require you to share more personal and financial information.

However, a pre-qualification offer or pre-qualified card offers typically occurs when you are engaged with the lender and seeking information about your credit card options and are not always firm offers.

A pre-qualification offer typically occurs when you are engaged with the lender and seeking information about your credit card options. The pre-qualified offers may be honored by the lender, but they do not have the same requirements as pre-approved or pre-screened offers and vary by lender.

Pre-qualified offers are often sought out by the consumer. For example, you might indicate your interest in a new card by completing a bank or credit company survey. The lender may then suggest you provide additional information so the lender can obtain your credit information and decide whether to extend an offer based on your credit information.

It’s important to note that pre-approved and pre-qualified offers do not guarantee that you’ll ultimately be approved for a new credit card. They simply mean that you have met at least some of the criteria required for approval. Card issuers generally reserve the right to deny your application pending an additional inquiry into your credit history, although the rules for approving applications from the pre-approved card offers are more stringent.

Does pre-approval affect my credit scores?

When credit card companies seek candidates for pre-approved offers, they ask the three nationwide consumer reporting agencies (CRAs) — Equifax, TransUnion and Experian — for your financial details. These credit checks are considered “soft inquiries,” and they will not impact your credit scores.

Once you decide to apply for a pre-approved offer, however, the application permits the lender to obtain additional credit information and will likely perform a “hard inquiry.” Hard inquiries, which do impact your credit scores, help lenders keep a timeline of how often you’ve applied for credit. Each hard inquiry may temporarily decrease your credit scores and will stay on your credit report for up to two years.

It’s important to apply only for cards you are serious about, as multiple applications submitted over a short time can trigger an influx of hard inquiries that may lower your credit scores and impact your ability to borrow in the future.

Why am I receiving pre-approved credit card offers?

Credit card companies send pre-approved offers only to people they think are likely to qualify for the terms of their card. So, if you’ve received one, the issuer already has much of the information they need to determine if you’re a good candidate, such as your credit scores and details about loans, mortgages and other aspects of your credit history. Much of that information comes from the three nationwide CRAs in the form of your credit report, which the lender uses to evaluate your financial health and creditworthiness.

If you meet their initial qualifications for pre-approval, card issuers then send a pre-approved offer in the mail. This is called a firm credit offer, which means the lender is legally required to fulfill the terms they offer you. If you decide you want to proceed, you’ll still need to apply for final approval. This last step gives lenders an opportunity to review financial information or other pertinent information that is not included in your credit report before making a final decision.

Are pre-approved credit cards right for me?

You should only consider adding a new credit card to your wallet if it makes sense for your unique financial situation. If you’re unsure whether a pre-approved offer could be right for you, be sure to weigh the pros and cons.

Keep in mind that pre-approved offers are essentially advertisements for specific cards, so you might not be getting the best terms and rates the company has to offer. Because you’ll only receive offers from some credit card companies, you may also miss good deals from their competitors, so don’t hesitate to research alternatives.

It’s also critical to make sure you know exactly why you want the card. Are you looking to rebuild your credit? Then keep an eye out for offers with a low annual percentage rate (APR) to save on interest. Are you on the hunt for a good rewards program? Then look for a card that offers points or cash back. A pre-approved offer may or may not meet your particular needs, so it’s important to consider your options. Thorough research and careful comparisons can help you evaluate the differences and choose the type of card that’s best for you.

How can I opt out of pre-approved offers?

If you find yourself overwhelmed by unsolicited offers or if you’re not in the market for a new card at all, you have a couple of options:

  • Go to OptOutPreScreen.com, a joint venture among the three nationwide CRAs. Here, you’ll be able to submit a request to opt out of these offers for five years or download a mail-in form to opt out permanently.
  • You can also call 888-5-OPT-OUT (toll-free) to limit what types of offers you’ll receive or to stop pre-approval offers permanently.

With both options, you can choose to opt back in at any time.

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