What Are Pre-Approved Credit Cards?

Published August 17, 2017 Markets

If you have a mail box, you probably get a few pre-approved credit card offers every month. Banks spend billions of dollars on these mailings, using data from the credit bureaus to pre-select and pre-qualify potential clients for one of the many credit cards in their lineups.

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But just because you're pre-approved doesn't mean you'll sail through the application process, and a pre-approved card may not be the best choice for you. Here's how to decide which cards are really worth applying for.

Getting pre-approved for a credit card means that, based on a limited amount of information, the card company believes you're more likely than average to get approved for a particular card.

The process typically goes something like this: a card company asks a credit bureau to supply a list of names and addresses of people who have a credit score within a specific range (750 or higher, for example). The bank can then use the provided zip codes to make some income assumptions. With these two pieces of information, the bank might decide to send an application for a high-earning cash back rewards card.

The key thing to keep in mind is that there are no promises associated with a pre-approved credit card offer because it is based on insufficient information. At the time of application, the bank will use reported income information and do a "hard pull" of the applicant's credit report to make a final decision.

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For obvious reasons, there is a very big difference between someone who has a 750 score because they have limited credit history and someone who has a 750 score because they dropped 70 points last month after making a late payment.

So why do banks bother pre-approving people for credit cards? Frankly, it works. According to a Federal Reserve report to Congress, 53% of new credit card accounts came from direct mail offers that were pre-screened. In contrast, only 17% of new card accounts came from mailed offers that were not pre-screened. The data is somewhat dated (2002), but it's only logical that people are more likely to apply and get approved when a card offer is tailored to them.

Pre-approval can mean special deals

Credit card companies increasingly use 0% APR balance transfers, sign-up bonuses, and other perks to lure qualified applicants to apply. In many cases, card companies tailor the offering to the individual with a better offer than is publicly available. But the reverse is also true. Pre-approved offers can also be worse than publicly available promotions.

If you receive a pre-approved credit card offer, it would be wise to see how that offer compares to the standard promotion available to the general public online. The terms of the pre-approved credit card may be very different from the standard list of benefits and perks.

Banks are notorious for offering different perks to their existing clientele, particularly inside the confines of their branches. When tellers look to their computer monitors behind the counter, they don't just see your bank balances. They can also see what kind of bank products you might qualify for. Relative to the public offers, some are better, and some are worse. It really all depends, but knowing this is paramount to making sure you're getting the best possible deal.

The key point to make here is that a bank might have 20 different credit cards, each with three different offers tailored to different people. Credit card offers change on an almost daily basis. We strive to keep on top of it, ranking the best credit cards at Fool.com based on offers that are available to the public.

It can be advantageous to apply online for any given credit card because, in many cases, the card company can give you an instant decision, and, in the case of denial, point you towards cards for which you will get approved. A student who has income of $15,000 won't qualify for the very best travel rewards cards, but he or she could easily qualify for a secured card or a card specifically designed for students.

Likewise, if you have high balances on other cards, you might not qualify for a card with a big sign-up bonus, but that might not be a bad thing. The bank may have a 0% balance transfer card that is more valuable for your needs, anyway.

This kind of instantaneous feedback isn't available if you apply by snail mail. By all means, if applying by mail is your only option, go for it. But as a general rule, applying online for a credit card has more benefits than applying via paper form.

If you no longer want to receive pre-approval offers, you can opt out for five years at a time (or permanently) by going to OptOutPreScreen.com, a website established to allow consumers to opt out of pre-screening consistent with the requirements of the Fair Credit Reporting Act.

Personally, I don't like junk mail, but I've concluded that junk mail that is targeted to my particular needs is a little more tolerable than junk mail that isn't. Understandably, though, many people might be annoyed by the barrage of credit card applications, so opting out may be a smart move.

5 Simple Tips to Skyrocket Your Credit Score Over 800!

100% pre-approved: 39mth 0% debt shift, credit rebuild, cashback & overseas cards

Pre approval credit cards links

By Martin Lewis , Money Saving Expert

Last week after I explained how credit applications work (at the Ideal Home Show) a woman commented "that's ridiculous, it means it's anti-shopping around". She's right. Usually the only way to see if you'll get credit and at what rate is to apply, which leaves a mark on your credit file. So if what you're offered isn't good enough and you want to try elsewhere, it's now more difficult.

I've given evidence in Parliament on this, but nowt's been done. So three years ago we built our eligibility calcs and this year we've taken a further leap forward, getting a few MBNA cards on 100% pre-approval and now adding Aqua, which specialises in cards for those without a great credit history (ie, past defaults or CCJs).

1. What the eligibility calcs do. Our Loan and Credit Card Eligibility Calcs do a soft search (you see it on your file, lenders don't, so no credit-score impact), which usually gives odds of 0% to 95% for getting top deals, so you can home in where your chances are best.

2. What does 'pre-approval' mean? With the 3 MBNA and 4 Aqua cards that allow this we can tell many people (not all) they've a 100% chance of getting that exact deal - subject to passing an ID and fraud check. There's no impact on your credit score, though of course if you then apply, that marks your file.

3. Pre-approved 39mths 0% balance transfers. A balance transfer is where you get a new card that pays off debts on old cards, so you owe it instead, at a cheaper rate. Our Balance Transfer Eligibility Calc shows which top cards you've the best chance of getting.

Always follow the Balance Transfer Golden Rules:

b) Never miss the min monthly repayment or you can lose the 0% deal.

c) Don't spend/withdraw cash. It usually isn't at the cheap rate.

Pre approval credit cards links

4. Pre-approved 0.5% cashback card with cheap spending overseas. The easy-to-get Aqua Reward card gives 0.5% cashback on all spending, and no 'load' when you spend abroad, so you get the same near-perfect exchange rates banks get - smashing bureaux de change.

How does it stack up? It's the only open-to-all card that does both cashback and cheap overseas spending. Yet for each separately it can be beaten.

5. Pre-approved 36mths 0% money transfers - ie, it pays cash into your bank. Some balance transfer cards also offer money transfers, which means they let you pay money into your bank, so you owe them at 0% instead. This is useful for clearing expensive overdrafts or as a small loan. Our Money Transfers Eligibility Calc shows which top cards you've the best chance of getting.

b) Never miss the min monthly repayment or you can lose the 0% deal.

c) Don't spend/withdraw cash. It usually isn't cheap.

d) If you're using it as a loan, try to make a fixed repayment, so you'll clear all the borrowing and the fee over the 36mth 0% period.

Pre approval credit cards links 100% pre-approved: 39mth 0% debt shift, credit rebuild, cashback & overseas cards

6. Pre-approved credit (re)build card with Ј20 Amazon voucher. Credit rebuild cards are designed for those with either no credit history or a poor one, to prove themselves good credit citizens to boost their credit score.

7. Pre-approved poor-credit 4mths 0% on spending. The Aqua Purchase gives 4mths 0% on spending, but is 34.9% rep APR after - it's the only 0% spending card targeting those with a poor credit history.

How does it stack up? The Post Office* & Clydesdale* allow accepted new cardholders 27mths 0% & 26mths 0% spending, but they need a good credit score. So use the 0% Spending Eligibility Calc to see your odds.

Warning: Only use Aqua for respite from payday loans/bank charges. New borrowing when you've poor credit is a bad idea. I include it because used cleverly it can take the pressure off payday loans or bank charges. To see how, read Repay payday loans via Aqua.

b) Never miss the min monthly repayment or you can lose the 0% deal.

c) Don't balance transfer/withdraw cash. It usually isn't cheap.

8. 35 tips to boost your credit score. The eligibility calculators are effectively a real life credit check - if your chances are low here, it'll be similar with mortgages and other products.

This article first appeared in the weekly email on 23 March 2016.

Prepaid Debit Cards – Guaranteed Approval

Pre approval credit cards links

Many consumers today are interested to know the basic features and characteristics of prepaid debit card programs. If you belong to this set of consumers, then we recommend that you read the remainder of this article. Below you will discover some basic facts as well as the advantages and disadvantages linked with the use of this prepaid card program.

A prepaid debit cardis a very unique card program. The reason for this is that this card is actually a combination of a credit card and debit card.

  • Benefits and Drawbacks Associated with Prepaid Cards

    Now what are the advantages of getting a credit card for bad credit? This card is actually a good tool in budgeting and managing your finances.

  • SHARE THIS PAGE ON Pre approval credit cards links

    Prepaid card is a card with no risk of having bad credit. There are no interest charges too. A prepaid card is the same as using a debit card that is linked to a savings or checking account.


    • $0 Monthly Fee Pay As You Go Plan (See Cardholder Agreement on site)
    • Free* Direct Deposit
    • No Credit Check or ChexSystems Checks
    • No Risk of Overdraft Fees
    • No Bounced Checks – Ever!
    • Easy Cash Reloading at 50,000 + Retail Locations
    • Send Checks with Easy Online Bill Pay

    *See Program Rules


    • $0 Monthly Fee Pay As You Go Plan (See Cardholder Agreement on site)
    • No Credit Check or ChexSystems Checks
    • No Risk of Overdraft Fees
    • No Bounced Checks – Ever!
    • Free* Direct Deposit
    • Easy Cash Reloading at 50,000 + Retail Locations
    • Send Checks with Easy Online Bill Pay

    *See Program Rules

    READYdebit® Visa Select Sunset Prepaid Card

    • Instant Account Number – A Great Card for your Money.
    • Free* Direct Deposit — Paycheck, Benefit Checks, Tax Refund Checks
    • Easy Online Bill Payment & Mobile Account Access
    • No Purchase Transaction Fees
    • No Risk of Overdraft Fees or Balance Minimums
    • Withdraw Cash at ATMs or Get Cash Back with Purchases
    • Use it Everywhere Visa Debit Cards are Accepted
    • Choose Your Card Color – Blue or Pink


    • Get Paid up to 2 days Faster with Free Direct Deposit * – Get Your Paycheck or Benefits Checks in Your Card Account and Access Your Funds up to 2 days Earlier Than Payday.
    • No CreditCheck to Get a Card. No ChexSystems Check. No Existing Bank Account Required.
    • $0 Activation Fee*. No Minimum Balance. No Risk of Overdraft fees.
    • $15 Bonus* with Qualifying Direct Deposit. Never Pay to Cash Your Paychecks and Get Your Pay Faster.
    • Use it Everywhere Visa Debit Cards are Accepted and Pay Anyone with PayAnyone Bill Pay. Shop Online, Rent a Car, Pay Your Rent and More.
    • Easy Mobile Account Access and Text Alerts. Get Your Account Balance, Transaction Details Sent to Your Phone within Seconds
    • BBB Accredited A+ Company. Excellent Customer Service.

    Advertiser Disclosure: See the online credit card applications for details about terms and conditions of credit card offers. Reasonable efforts are made to maintain accurate information. However all credit card information is presented without warranty. When you click on the “Apply Here” button you can review the credit card terms and conditions on the credit card issuer’s web site.