Credit card companies go through cut-throat competition. In their spree of winning more clients, they keep bombarding emails about pre-approved credit cards. These are just promotional offers to entice customers to buy a credit card from their company. Statistics suggest that there are thousands of such offers floating in mailboxes every single day. Although the offers are really alluring, you must have a clear idea about the actual scenario.
A piece of advice would be to not jump on the offers received in the mail. First, know the credit card pre-approval process in detail. Know the answer to the obvious question ‘am I eligible for a credit card?’ and then apply so that the chances of rejection become minimal and you can buy a credit card without any hassles. Find here, all the details of the pre-approval process, various checks and the conditions of denial.
Credit card pre-approval process explained in detail:
If you have been hunting for a good credit card company and are lured by the marketing emails, then get to know the truth now. If you get a mail about a pre-approved credit card leading to a credit card application, then you need to hold things there. Mind it that credit card providers may not have your complete information and their offer would not be based on solid facts. They are sending the mails to get an actual application from you.
Next big thing to consider is that they may have sent the mail based on old information. Also, the card offer they have sent to you might not be suitable. It is one hell of a marketing strategy that works psychologically and gains the customer’s attention. The mails make you feel that the company has checked your data personally which may not be the gospel truth. So, you need to first see which credit cards you qualify for and then only apply. Research is the first thing that you need to do.
What happens when you apply for a credit card?
Well, just like every other application, the credit card companies also filter their customers and check whether they are worthy of their credit business or not. Whether it is an online form or a paper form, the lenders make it pass through four stages so as to make a decision for giving you a credit card.
The main stages of credit card application are:
Identity check: The lenders would like to be assured about your identity to avoid any fraud. Firstly, they will check about your nationality and whether you are a UK resident or not. Your legal information will be matched with the electoral register of the UK to know if you are a citizen. They will have a clear idea about your age, income and residential status. They may ask for documents like a certified copy of your passport and address proof in the form of utility bills.
Customer profile check: Credit card companies would get all information from your application and analyse whether you will be a good investment for them. They execute various checks on your profile before actually approving the application. Starting from your residential status to your payment behaviour, everything gets scrutinised at this stage.
Cross check: The card supplier would cross check your application against anything and everything they know about you. Be it a previous dealing or the number of times you have applied for a credit card or your financial stability, everything that helps them gauge your eligibility for their card. This process helps them find more about the customer and to find if a particular person would be good to invest in.
Credit check: At this stage, they will check your credit report. A credit report or credit file gives away the financial behaviour of the person. It is compiled by any one of the most reliable credit reference bureaus such as Equifax, Experian and Callcredit. The credit report is the most important criteria for a lender to approve your application. The company would require your consent to review your credit report. If you have a bad credit rating, then chances of denial increases.
Once your application clears all these stages, it will be clear whether you pass or fail the lender’s criteria. If you pass then your application will be approved and you can start using the credit card. Otherwise, you will be have to face a referral or decline. In case of a referral, you are supposed to give more information to the lender so that they can get assured about you.
The details given above will help you find more about your eligibility for credit cards. If you know the process well in advance, then it helps you to rectify your credit score and get an easy approval from any credit card company. To know more about which credit card company is best for you, use the credit card comparison service of FreePriceCompare.com.
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