Pre-approved credit offers

Those pre-approved credit offers that consumers find in their mailboxes don't materialize out of thin air. They target specific kinds of consumers who meet certain criteria during what is called the pre-screening process.

In this process, a credit information organization such as Experian screens a list of consumers for their value as potential recipients of a direct-mail campaign, particularly one that offers pre-approved credit.

The list of consumers may be supplied by the paying customer or culled from the credit bureau's own databases. Such screening is completed through the application of tests and parameters that may be modified for each run. Pre-screen products and services are available to customers according to their markets, needs and sophistications. In addition to credit card issuers, customers might include small firms-such as gardening services or construction outfits that remodel homes-that want to solicit the business of an area's new homeowners, for instance.

For the consumers, a pre-approved credit offer generally doesn't automatically grant credit, but offers the opportunity to apply for it. That's because the creditor will want to see if the consumer's credit history has taken a recent downturn before actually granting the credit line. The creditor will also check to see if pertinent data in the history jibes with information supplied by the applicant.

Valuing consumer privacy, Experian will make the effort to remove your name and address from pre-screening consideration. You can opt-out by calling 1-888-5OPTOUT.

This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.