The mailman arrived and brought him: Some invoices, a letter from his aunt Mary, a circular from a local store, the monthly summary of his bank account, and an offer of a credit card that says you are “pre-selected” or ” prequalified. “
A “preselected” credit offer? What is that?
Many companies that offer credit cards and insurance policies use a preselection method to identify potential customers to sell their products to. Preselected offers – sometimes called “pre-approved” or “pre-qualified” offers – are based on your credit report data indicating that you meet the criteria set by the company offering the credit card or policy for sure. Usually, pre-selected offers arrive by mail, but you can also receive them by phone or email.
How does the pre-selection work?
The preselection works in one of two ways:
- A credit grantor or insurer establishes a criterion, for example, a minimum credit score, and asks a credit reporting company for a list of the people in its database who meet that criterion.
- A credit grantor or insurance company gives a list of potential clients to a credit reporting company and asks the company to identify which people on that list meet certain criteria.
Can pre-selection negatively affect my credit report or my credit score?
No. Your credit report will include the “inquiries” made by the companies that obtained your information to do the preselection, but those inquiries will not have a negative effect on your credit report or your credit score.
Can I reduce the number of offers of credit and insurance I receive?
If you decide that you do not want to receive prescreened credit and insurance offers, you have two options: You can choose not to receive them for five years or choose to stop receiving them permanently, in English, this voluntary exclusion is called “opt-out”.
When you call the phone number or visit the website listed above, you will be asked for certain personal information, for example, your home phone number, your name, Social Security number and date of birth. The information you provide is confidential and will be used only to process your exclusion request.
If you do not have access to the internet, you can send a permanent exclusion request in writing to each of the major credit reporting companies. Be sure to include your home phone number, your name, Social Security number and date of birth in your letter.
Be considered to opt or not choose not to receive this type of offer?
Some people prefer not to receive this type of offer by mail, especially if they are not looking for a new credit card or insurance policy. They may also want to limit access to the data in their credit reports, or simply reduce the amount of mail that arrives in their mailboxes. However, some companies send offers that are not based on pre-selection, and the exercise of their right to opt-out will not stop this type of offer.
If you are considering your voluntary exclusion, it is good to know that pre-selected offers can offer you several benefits, especially if you are looking for a credit card or an insurance policy. Preselected offers can help you know what options are available, compare costs, and find the best product for your needs.
As they have already pre-selected for that product, they can only be denied under limited circumstances. In addition, the terms of the preselected offers may be more favorable than the terms available to the general public. In fact, some credit cards or insurance policies are only available through the prescreening mechanism.