Why Do I Get So Many Credit Card Offers in the Mail?
Your mailbox is stuffed with them, and they’re probably some of the only real mail you get. Mailed credit card offers have become more common in the years since the 2008 financial crisis and recession. It seems like banks are one of the few who still market by postal mail, but why do they do this? And if you’ve noticed you’re seeing a lot more of these offers in your mailbox recently, what’s the reason?
Explaining Mail Offers
Mailed credit card offers are really just advertisements for credit cards.
Marketing through the mail used to be much more popular than it is today. As better, more engaging marketing techniques have become preferred with the rise of technology, this method of advertising products to potential customers has lost some of its appeal.
However, this shift has given banks and lenders an advantage in this marketing channel: exclusivity. Since you don’t receive many offers in the mail, the ones you do receive are likely to get more of your attention.
The kind of messages you receive from lenders depends on your credit score. Lenders purchase names from credit reporting agencies, which don’t always give away information about your exact score, but do give lenders an estimate of what your score looks like.
Two Types of Offers
Lenders use two different ways of advertising credit cards in mailed offers, depending on if you have good or bad credit. Each method focuses on a unique benefit to the customer that the ad is tailored to.
If you have poor credit, sometimes the offer might seem less like an ad and more like an exclusive benefit or service the lender is offering to you. These offers usually use the term “pre-approved”, which may seem enticing if you’re struggling to build credit. However, even if you’re “prescreened” or have been “pre-approved”, there’s no guarantee that you’ll really get the offer you received.
If you have good credit, you’ll receive pre-approved offers for cards with some kind of bonus attached to them. This might be something like a reward card, an extra $100 bonus for signing on, or a rewards bonus like airline miles. Lenders are less focused on selling to you based on the fact that you have a chance at getting the card — you know you can probably get most cards you apply for — and are more focused on getting you to sign up to secure the perks, since you can be a little choosier with your cards when your credit is good.
Common Questions about Pre-Approved Offers
Question: What do I do with credit card offers?
Answer: Some of it’s a must do, some of it is up to you.
Always shred your credit card offers. Mailed offers open you up to fraud and identity theft. It’s easy for someone to take one of these offers out of your trash and fraudulently sign up for cards under your name, if they have the right information about you.
Whether or not you apply for the card you’ve been offered is something you decide. Check the APR, any associated fees, the credit limit, penalty fees, and for any perks to the card, like cash back bonuses. It’s also a good idea to learn a little about the different credit card companies.
Question: Do pre-approved offers hurt my credit?
Answer: Don’t stress — these offers can’t hurt your credit, unless you apply for one. The pre-approval process for these cards is a soft inquiry. Mail offers don’t mean the bank has actually checked your credit score, so although you won’t be penalized for “pre-approval,” this also means that it’s not certain you’ll be eligible for the offer you received.
Question: What happens if I apply for an offer?
Answer: It depends! Whether your credit is good or bad, your chances of being approved for a pre-screen offer are still better than if you were applying for cards at random.
If you’re someone who has poor credit, the chances of you getting the offer advertised is lower than you might expect — averaging about 80 percent, according to credit expert John Ulzheimer. A lot of the time lenders will still extend an offer, but it will be for a less preferred card, maybe with a lower limit or higher APR. If the lender can’t offer you anything, the inquiry could ding your credit.
If you have good credit, says Ulzheimer, your chances of getting the card you’re wanting are more like 95 percent.
Question: What if I don’t want to receive these offers anymore?
Answer: Opt out! It’s as easy as that. Opting out tells the credit bureaus that you’d prefer not to be on the lists they send to banks.
Mailed, pre-approved credit card offers are the marketing trend for this product, but stay savvy to the methods used. Now that you understand a little more about how and why you end up on the mailing lists, it should be easier to make informed decisions about the products you’re being offered. Always choose and use your credit cards wisely.
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This post was updated June 25, 2017. It was originally published June 30, 2017.