One of the most common ways to do this is through a soft inquiry or soft pull of a person’s credit history. And that’s it.Ī person who receives a pre-approved credit card offer has been targeted for that offer because the credit marketer has taken a closer look at the person’s financial characteristics. Pre-approved offers are most often just one more step further in the application process. To define a pre-approved credit card offer is simple. Which leads us to … Pre-Approved Credit Cards The better a person’s score, the easier it is for them to qualify for loans, and consequently, more credit.Ī pre-qualified credit card offer means at the time of the offer a person’s credit score falls in a particular range or has some other characteristic such as “no delinquent payments in the past 12 months.” Because that person’s credit history matches that characteristic they are one step closer to being approved and that puts the person on a list of people who are now pre-qualified to receive the offer.īut the caveat here is that there is zero guarantee that when the same person who pre-qualified for the offer gets around to filling out an application for the credit card offer, they will pass the approval process. This credit reporting adjusts a person’s score regularly. Each month a thee major credit bureau (the three major credit bureaus are Experian, Equifax, and Transunion) receives information about peoples’ financial activity. This is one of the top reasons why having a good credit score is important. The most common characteristic used to judge a pre-qualified offer is a person’s credit score. So what a company typically means when they say a person is “pre-qualified” for an offer is that the person has characteristics that the credit card company knows fit what they are looking for. These checks of an applicant’s information are to alleviate risk.īut credit cards are a very competitive market so being able to give a potential customer some assurances that they are the type of candidate the credit card marketer is looking for goes a long way toward getting more people approved. Qualifying for a loan has many checks along the way and requires due diligence by credit card companies and credit bureaus. The big difference in the terminology has to do with the process of how the credit card marketer makes their decision. The first thing to know is that whether it’s a pre-approved credit card offer or a pre-qualified credit card offer, a person is not guaranteed to receive the credit card. This holds true whether you’re in the middle of the mortgage process applying for a home loan or you are filling out an online form to apply for a credit card. Neither guarantees loan approval, but if someone says a person is pre-approved or that they are pre-qualified, then a key first step in the process of obtaining a loan. And that means there is a small difference between loan preapproval and prequalification. pre-qualified credit cards is a confusing question that comes up often for people who are interested in getting a new credit card.Īt its core, these terms have to do with the fact that lines of credit are essentially loans. Does prequalification affect your credit score.
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