What Is The Credit Opt-Out Myth?

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What Is The Credit Opt-Out Myth?

There are many myths in the world of credit. Here at Personal Tradelines, we often find ourselves having to bust these myths so that people can understand their credit, rather than live in fear of it.

 

The question that we’re going to answer today is:

 

What is the opt-out myth and why doesn’t it work?

 

Understanding Pre-Screened Credit Offers

 

A pre-screened credit card offer is an offer that a credit card company will send out to a consumer that has a credit profile similar to that of the main customer base of that particular company. A bank will decide what kinds of consumers should receive these offers by contacting the credit reporting agencies and purchasing pre-screened lists of consumers from them.

 

In essence, a credit card company might request a list of three million consumers that have credit scores anywhere between 650 and 750, have not opened credit card accounts in the past 12 months, and have never had any bankruptcies on their report.

 

The credit bureau will tap into its system and put together a list of consumers that fit under that umbrella. That credit bureau will then sell their list to the lender so that the lender can turn around and send credit card offers out to these consumers.

 

Is This Legal?

 

Yes. If it wasn’t, it wouldn’t be such a popular marketing scheme for these companies. Credit reporting agencies have been allowed to do this for a long time and it has never been seen as “controversial” in any way.

What Is The Credit Opt-Out Myth_ - Personal Tradelines

What Is The Credit Opt-Out Myth_ – Personal Tradelines

For credit card companies, buying these pre-screened lists is one of the best ways to find new customers. You’ve likely received some of these types of offers in the mail before.

 

During the pre-screening process, the credit card company will have to perform a soft pull on your credit report.

 

Because of this, you may end up seeing some soft inquiries on your credit report with company names that you may not recognize. Don’t fret. These companies are simply pulling your information to send you offers and it will not impact your credit score.

 

Removing Your Information From These Pre-Screened Lists

 

If you choose to do so, you can remove your name from these pre-screened lists. This is what is called the opt-out option. The beauty of opting out is that it is totally free to do. You can visit optoutprescreen.com to do so.

 

The myth that surrounds the opt-out process is that if you choose to opt-out of pre-screened credit card offers, your credit score will increase. However, because these companies use soft inquiries, not hard inquiries to check your credit reports, you don’t have to worry about it negatively impacting your report.

 

Simply put, opting out just means less paper in the mail.

 

If you’re looking to potentially take your credit score to the next level and find legitimate ways to boost it, we highly recommend looking into authorized user tradelines here at Personal Tradelines. We’ve helped thousands of consumers reach their credit goals. Get in touch with us today.