Why Did I Get This Pre Approved Credit Card Offer?
Today we are going to discuss all those pre approved credit card offers that we all get in the mail. Most people will just throw them away, but many times if used properly they can be a really great deal. So how do pre approved credit card offers work?
Pre Approved Mail Offers
The reason you get a pre approved credit card offer is that you were pre screened or pre qualified based on your credit score. At the time the credit card company did their research, you met the requirements to get a pre approved offer.
When you get credit card offers in the mail, especially the ones for 0% APR interest credit cards, more than likely you have good to excellent credit.
Most of the pre approved mail offers have an invitation letter with a reservation code on them. It will also have a website where you will go and put in your reservation code before being directed to the online application for that specific card offer.
Generally these pre approved credit card offers have 0% APR interest rates that can vary from 12 to 21 months. This low interest rate can include purchases and balance transfers. If you have higher interest credit cards and good credit it might be worth the effort to transfer your balances to the lower rate credit card. Over time this can add up and save you on interest.
You may also be thinking about making a large purchase or home improvement. These pre approved credit card offers can be great if used at the right time.
Let’s say you are going to make a large purchase. You can divide the amount by 12 months to get your monthly payment at 0% interest. If you buy a new home theatre with new 4K HGTV it might run you $6,000. You can just apply for the credit card online and once approved make your purchase. Then you will pay $500 for the next 12 months at 0% to pay it off.
Utilizing these credit card offers can really save you money if used at the right time.
Getting Pre Approved Online
Most people do not realize it, but you can go to most credit card issuers sites and get pre approved or pre qualified online.
The websites have an area that will ask you if you want to be pre qualified. You will just fill out a simple form and some personal information. They will also ask for financial info. The tool on these websites will do what is called a soft pull on your credit. A soft pull should not impact your credit like a hard pull would when applying. You will then find out if you are pre approved or pre qualified and can then fill out the online application if you choose.
Benefits of Comparing All Your Credit Card Options:
When you get a pre approved credit card in the mail and see the offer it can be exciting. You feel special that the credit card company wants you to apply.
Just remember to read through the entire offer and make sure it is a good fit for you and your lifestyle.
There are a number of excellent credit card comparison sites where you can compare all the card features. Then make a decision on the credit card that is right for you.
If the pre approved mail offer is what you have been looking for then go for it and apply. But if it is not, then go online and check out some other credit cards before you make your decision. Remember you can always get pre qualified. This can help identify the right credit cards you will qualify for.
There Are No Guaranteed Approvals
Most people think that since they received a pre approved credit card invitation that they are guaranteed to get approved for a credit card. Sometimes this is not the case and a persons credit score can change. This is another reason to pre qualify online first. Make sure you compare interest rates and understand that these are introductory periods that will revert back to the regular interest rates at some point.
Watch Out For Balance Transfer Fees
Another thing to remember is that when doing a 0% balance transfer that there is usually always some type of fee associated with it. Usually a balance transfer fee will run you 3% to 5% of the amount being transferred. So if you are transferring say $5000 onto the credit card, you will pay $150 balance transfer fee at 3%. This may be OK with you since you will be getting a fixed 0% interest rate on this card for multiple months into the future. But, just make sure you know and understand this fee up front.
The Bottom Line
So the next time you get a pre approved credit card offer in the mail, I hope you will be more informed. You can either throw it in the trash or take advantage of it. When you do choose to take advantage of it for a balance transfer or major purchase, it should save you a few bucks. Just remember to pay it off in a timely manner before the 0% introductory offer runs out!
Also, remember even if you do not use the reservation number and confirmation code that is OK. You can visit a comparison site and just apply directly for the credit card. The only reason you got the invitation was that your credit score was good enough at the time to qualify you.
You can also just go direct to the issuer site and get pre qualified for credit cards on their site.