Finance Quick Answers
I received an application in the mail for a credit card which said I was "Pre-approved." However, when I sent in the application, I was rejected. How could that be?
Buried in the fine print of your credit card
application, agreements, and correspondence from the
card company are provisions that can cost you plenty.
Here is one trap to look for in tiny type. Pre-approved
cards often come with hidden catches, don’t assume
you’ll automatically get the card. Under a new law
recently passed by congress, card issuers can now reject
pre-approved applications based on credit criteria.
Reasons can include your bill paying record, and how
short a period of time you’ve lived at your current
address. If you don’t meet the criteria for the promoted
lower rate, the issuer may reject your application or
send you a card with less attractive terms. Although the
fine print warns you that your credit will be reviewed,
most people have no idea that additional credit factors
will be considered before the card is issued.
Source: Bottom Line Personal - Oct 15, 1997
Written by:
Sandra McKinnon, Consumer & Family Economics Specialist,
University of Missouri Extension
Cynthia E. Crawford, Ph.D., Consumer & Family Economics Specialist, University of Missouri Extension
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Last update: Monday, July 28, 2008
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