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It is usually seen that individuals receive mails regarding new credit cards, debit cards, loans, offers for loans etc. Pre-approved credit cards are not actually approved. There are some facts about pre- approved credit cards which are not known by everybody.
It is actually very important to know these facts. Pre-approved credit cards are sent to the individuals by the banks after scanning their database. Banks send the pre-approved credit cards to the email ids of those individuals who would be interested in applying for the credit cards.
Meaning of Pre-Approved Credit Cards
Pre-approved credit cards are offers of credit cards that come with a lesser interest or some beneficial rewards scheme. There is a process of giving a credit card to those who have applied for them. In this process, the issuer of credit cards will ask the credit bureau for a consumer’s list which displays the list of those individuals who are eligible to get the credit cards. This is actually an invitation for an individual to apply for a credit card.
If you are eligible to get a credit card, then your name will surely be there on that list. After this analysis, you will receive an offer of pre-approval of the credit card.
Why Credit Card Pre-Approval Offers Are Not What They Actually Seem to be
Even though you have received an offer for a pre-approved credit card, you need to apply for. After your application, your credit history and credit information will be checked by the credit issuer. This is done to check if an individual is eligible for a credit card or not.
- Good News: The good news associated with pre-approved credit cards is that sometimes you get the credit cards for the same rate that has been mentioned in the offer document of the pre-approved credit card.
- Bad News: Sometimes it so happens, that the interest rate is higher than the one that was mentioned in the offer document of the credit card. It may also happen that you have been completely denied the credit card.
Things to Be Done after Receiving a Pre-Approved Credit Card Offer
1. Do Proper Analysis:
It is important that you do an analysis of all the things that are offered to you by the credit card. Before you finalize on the credit card, it is better that you do an appropriate research about the offers that are given by other credit cards also. After doing the analysis, you should choose the best option available to you.
2. There is No Guaranteed Approval:
Having received an offer for a pre-approved credit card in your inbox does not mean that your credit card application is guaranteed to be approved. The approval of your pre-approved credit card depends on an individual’s credit score and credit history.
3. Stop Receiving Pre-Approved Offers:
It is always good to stop receiving the pre-approved credit card offers. In order to reduce the number of pre-approved credit cards, all you need to do is to opt out at optoutprescreen.com. After doing this, you will not receive most of the pre-approved credit card offers. You are likely to receive few offers of pre- approved credit cards from those companies that are doing business with you and have received your information through unknown sources.
When Should You Say Yes to a Pre-Approved Credit Card
1. If the cashback and rewards offered by the credit card you have been using currently are not as good as the cashback and rewards offered by the pre-approved credit card, then you can opt for this credit card after completing a proper research about it.
2. If you are an individual, who has a high CIBIL Score, then it is good to opt for the Pre-approved credit cards. The pre-approved credit card offers are useful in the long-run and it is worth applying for them.
Precautions to Be Taken with a Pre-Approved Credit Card
1. If you have received a physical card along with the pre-approved credit card offer, then you be extra careful with it and avoid using the physical card. If you use it, you might get trapped in a credit damage or fraud.
2. When an individual receives the offer of a pre-approved credit card, he is not told by the bank that if he chooses to apply for the credit card, there will be an analysis of the individual’s creditworthiness.
3. There are chances for your application of credit card getting cancelled.
4. Apart from the above considerations, one thing you should also be watchful about is your credit score. It is sure that your credit score will come down because you have applied for a credit card, which is considered as a hard enquiry. Hard enquiries are bound to lower the credit score of individuals.
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