What is a pre-approved credit card

 Pre-approval is based upon known credit history or data supplied when applying for a credit card. An offer for a pre-approved credit card may be subject to a credit report review to ensure no changes have occurred which might void the pre-approved credit card offer.

Rather than mailing credit card offers to everyone with an address, banks target mailings towards consumers who are more likely to respond, qualify for the card, and become profitable customers. When preparing for a mail solicitation campaign, a card issuer may send a set of minimum standards to one of the credit bureaus (Equifax, Experian, or Trans Union), and request a list of consumers whose credit reports meet the qualifications. The bank may send a list of consumers obtained elsewhere (e.g. from a marketing database company) and have the bureau return a subgroup that matches the criteria. "Pre-approved" offers are then sent to everyone on the list.

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If you have a copy of your credit report, you may see inquiries that are designated as "promotional." This means that your file was checked for a "pre-approved" list, although it does not necessarily mean that you qualified to receive an offer. Since this type of inquiry was not initiated by you, it is not seen by other prospective creditors to whom you might apply, and will not reduce your FICO credit score.

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When a consumer completes the application and returns it, it goes to a processing center (which may be owned by a separate company from the issuer) where the data is entered into a computer system which then does a credit check on that specific individual. This is to determine if anything in the consumer's credit file has changed for the worse since the original sweep, and the qualification criteria may be higher. This credit check (not the original one) is used for final approval or rejection of the application.

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 Sometimes fairly subtle changes in the consumer's file (like total available credit or balance-to-limit ratio) since the pre-screening can result in a rejection. Final approval is also dependent on your application information (e.g. income) meeting issuers standards, so if this is insufficient, you will be declined.

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A "pre-approved credit card" offer does not mean that you will definitely receive a card. When an interest rate is promised as being "as low as" a certain amount, that is not a guarantee of that rate. And "up to" a certain credit limit does not necessarily mean that it will be anywhere near that.