What Does It Mean to Be Preselected for a Credit Card?

Receiving a credit card offer stating you’ve been “preselected” is common. These offers often arrive in the mail or appear online, suggesting that a credit card issuer has identified you as a potential candidate for one of their products. Understanding what this signifies and how to navigate such offers is important. This article clarifies preselection, how offers are generated, distinctions between solicitations, and steps for responding.

What Preselection Means

Being “preselected” for a credit card indicates that a financial institution has conducted a preliminary review of your credit profile. It is a marketing strategy designed to target individuals who are likely to qualify for a specific credit product. However, a preselection offer is not a guarantee of final approval. It functions as an invitation to apply, contingent upon a full review of your financial information.

Credit card issuers utilize preselection to streamline their marketing efforts and focus on consumers who align with their desired risk profiles. This process helps issuers manage their risk while also attracting new customers.

How Preselection Offers Are Generated

Credit card issuers primarily rely on credit bureaus to identify individuals for preselection offers. They provide criteria, such as a specific credit score range or payment history, to credit reporting agencies like Experian, Equifax, and TransUnion. This process is governed by regulations that allow creditors to obtain such lists for “firm offers of credit.”

The inquiry made by credit card issuers for preselection purposes is known as a “soft inquiry” or “soft pull.” A soft inquiry occurs when a credit report is reviewed without a formal application for credit. Unlike a “hard inquiry,” a soft inquiry does not impact your credit score. In addition to credit bureau data, issuers may also use other internal data points, especially if you are an existing customer, to generate these targeted offers.

Understanding Different Credit Card Offers

Credit card marketing frequently uses terms like “preselected,” “pre-qualified,” and “pre-approved,” which can sometimes be confusing. While these terms are occasionally used interchangeably by issuers, they carry subtle but important distinctions regarding the likelihood of final approval.

“Pre-qualified” often implies a slightly more refined assessment, sometimes initiated by the consumer providing basic information online, though it still does not guarantee approval. The issuer performs a soft inquiry to determine potential eligibility. “Pre-approved” is generally considered the strongest of these terms, often indicating a more thorough review by the issuer. If you receive a “pre-approved” offer, especially one that states it is a “firm offer of credit” under the Fair Credit Reporting Act (FCRA), the issuer is obligated to honor the terms if your credit situation remains consistent and you meet any additional stated criteria, such as income requirements.

Responding to a Preselection Offer

Upon receiving a preselection offer, it is important to carefully review all the accompanying terms and conditions. Key details to examine include the Annual Percentage Rate (APR) for purchases, balance transfers, and cash advances, as well as any annual fees, foreign transaction fees, or late payment penalties. Understanding the rewards program, if applicable, including earning rates, caps, and redemption rules, is also essential. These details are typically found in a standardized “Schumer Box” and the fine print of the offer.

If you decide to proceed with an offer, you will need to complete a formal application. This application process will trigger a “hard inquiry” on your credit report. A hard inquiry can cause a small, temporary dip in your credit score, typically fewer than five points. While hard inquiries remain on your credit report for two years, their impact on your credit score usually diminishes after 12 months. If you prefer not to receive future preselection offers, you can opt out through the official website OptOutPrescreen.com, which removes your name from lists used by credit bureaus for marketing purposes.