PRE-APPROVED CREDIT CARD OFFERS

Have you ever received an offer in the mail that states, "Congratulations! You are pre-approved for a credit card!"? In this letter is a credit card with your name as well as a letter with a brief application of the credit card's terms and conditions written in fine print on the back. What does this mean?

Credit card companies are always looking to build their client base. As a result of advertising costs and the cost of processing applications, acquiring new accounts can be quite costly. The 'acquisition cost' can be up-to $200 to obtain a new account. Direct mail response rates are extremity low. In fact, less than 2% of pre-approval recipients fill out and return the application.

Credit card companies do not mail these offers to people blindly. They do research and target their mailing to customers that they feel will be more likely to qualify and respond to their offers. You may ask yourself, 'How do they know who to send to?'. This is a rather interesting answer....when preparing their mail campaign, the credit card issuer will contact one of the major credit reporting bureaus to request a list of people whose credit report information matches the qualification criteria for credit card approval. The credit card company may also use a list obtained from a different source, i.e. a marketing database companies. They will use this list to find individuals that match the criteria they are looking for.

When you obtain a copy of your credit report, you can see how many of these promotional inquiries are present on your file. Please note that just because their is a check for a pre-approval on your credit report, that does not mean the offer was sent to you. It is also important to know that since you did not initiate these inquiries, they are not seen by any prospective creditors and will not lower your credit score!

Bad credit issuers look to take advantage of people with damaged credit by sending pre-approved offers with high interest rates and fees.

Once you fill out the application and send it back, your information is entered into a data system for a credit check. Your credit check will determine if you still meet the qualifications for approval. Even a small change on your credit can result in a denial.

How much money you earn will also have important role in whether or not you are approved.

You are not guaranteed approval when you receive a pre-approval offer in the mail. Also, the interest rates being offered are usually 'as low as' and are almost never obtained by the applicant. These low rates are 'teasers' used to lure in potential applicants.

If you are not interested in receiving pre-approval offers you can call 1 (888) 567-8688 and request to be taken off the pre-approval list. Once your name is removed, the credit reporting companies will no longer allow these pre-approval inquiries.

Credit Card Basics:
- Pros and Cons of Credit Cards
- How Credit Card Issuers Make $$
- Shopping for a Good Interest Rate
- Credit Card Cash Advances
- Problems with ATM/Debit Cards
- Advantages with ATM/Debit Cards
- Credit Card Record Keeping
- Tracking Billing Errors
- What is a Billing Error?
- Fixing Billing Errors
- What is a Stop Payment?
- How to Prevent Identity Theft
- Pre-approval Credit Card Offers
- Safeguarding Receipts

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