Opting Out of Prescreened Offers

Worried Hispanic Woman Checking MailboxHave you ever wondered how that credit card company was able to “Preapprove” you without getting information from you?  Or how the companies that offer credit cards to people with    low credit scores know you have blemishes in your past?  The answer is that you have been “Prescreened” and you can thank the major credit bureaus for those solicitations in your        mailbox.

A prescreened offer is a result of the credit issuer obtaining your name and information from one or more credit bureaus.  The company likely provided to the bureau(s) certain credit criteria they were looking for, who in turn searched their massive database and produced a list of people that meet that criteria.  The creditor then uses that list to solicit you to apply for credit with them.  It is actually an efficient marketing tool for the creditors because it prevents wasting money soliciting potential borrowers that don’t meet their requirements.  It also allows companies that specialize in working with borrowers that have lower credit scores to filter strong credit borrowers who would likely discard their higher interest rate offers.  In other words, the practice allows the credit companies to better target their marketing towards a desired clientele.

Before you throw those offers in the trash without opening, there are some benefits to you in receiving them.  By theory, you should receive offers that you are likely to qualify for.  This will help you determine if there are better products available with more favorable terms than you may currently have.  They will also introduce you to companies that have credit products available that you otherwise may not be familiar with.  Furthermore, the inquiries that are left in your credit file when you are part of this process do not negatively affect your credit scores or history.

There are also downsides to these offers besides just cluttering your mailbox. They can contribute to identity theft if someone steals your mail. The solicitations are not going to have some key information in them, such as your social security number.  But they often have more personal information than you want a criminal to have.  Loss of privacy is an issue to consider also (Have you ever had your mail misdelivered to a neighbor?).

If you have put some thought to the topic and decided you no longer wish to be considered for these prescreened offers and do not want them coming to your home or office, you can stop them fairly easily. Under federal law- the Fair Credit Reporting Act- you can opt-out of the practice entirely with a choice of a temporary opt-out period of 5-years or doing it permanently. Each member of the household must make their own opt-out request.

If you wish to use the temporary 5-year option, there are two ways to make your request.  You can call toll-free to 1-888-5-OPT-OUT (1-888-567-8688) or go to www.optoutprescreen.com. The phone service and website are both maintained by the major consumer reporting agencies, not creditors.

If the permanent removal is your preference, it must be done via the web site (www.optoutprescreen.com). As part of this process, you will need to print, sign and return a form titled Permanent Opt-Out Election form.

You can opt back into the program at a later date if you change your mind by calling the same phone number or via the same web site you used to opt-out.  There you will choose Opt-In to reverse your previous decision.

 

Please keep in mind that doing one of the above actions does not remove you from the Do Not Call List. Telemarketers and other companies that already have your contact information from a previous relationship with them or other means may still solicit your business.  To add your phone number(s) to the National Do Not Call Registry, go to www.donotcall.gov .