November 30, 2023 |1:20 min video
What does it mean when you see pre-qualified or pre-approved on a credit card offer? It typically means your credit score and other financial information matched at least some of the initial eligibility criteria needed to become a cardholder. Even though these two terms are sometimes used interchangeably, there are some differences to keep in mind.
Keep reading to learn more about what it might mean to be pre-qualified or pre-approved for credit card offers.
Key takeaways
- Both pre-qualified and pre-approved credit card offers usually result from a credit card issuer working with a credit bureau to look at your basic credit information.
- A pre-approval might indicate a slightly higher chance of having an application accepted than a pre-qualification. But ultimately, it depends on the issuer.
- Getting pre-qualified or pre-approved for a credit card doesn’t guarantee approval.
- Pre-qualification and pre-approval for credit cards both typically involve soft inquiries, which don’t affect credit scores.
- Applying for new credit generally requires a hard inquiry, which could temporarily cause credit scores to dip.
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Get startedPre-qualification vs. pre-approval for credit cards
“Pre-” is the key part of both terms. When a credit card offer mentions that someone is pre-qualified or pre-approved, it typically means they’ve met the initial criteria required to become a cardholder. But they still need to apply and get approved.
Think of these offers as invitations to start the actual application process. Once someone has already been pre-qualified or pre-approved, these offers can give them more confidence when they start the application process.
What does pre-qualified mean for a credit card?
In general, pre-qualification means a credit card issuer has done a basic review of your credit reports and found that you might qualify for a card. If you’re interested in the card, you can give the company personal and financial information—like your Social Security number and monthly income—to help it take a closer look.
Keep in mind that pre-qualification isn’t a guarantee. But it can give you a sense of whether you may be approved if you take the next step and apply for a card.
What does pre-approved mean for a credit card?
Pre-approval also typically involves a prescreening that’s done by a credit card issuer. The issuer may work with a credit bureau to target people who are likely to qualify for a certain card. For that reason, the criteria may be more rigorous than they are for pre-qualified offers.
One major difference between pre-approved and pre-qualified offers: Pre-approved offers can be stronger indicators of approval. That means you can generally move forward to the application phase with a higher degree of certainty. But it doesn’t guarantee approval.
How do you get a pre-qualified or pre-approved credit card offer?
Credit card issuers typically set some basic initial eligibility criteria for a card. Then the issuer asks credit bureaus for a list of people who meet those criteria. From there, the issuer may send those people pre-qualified or pre-approved offers. Some pre-qualified or pre-approved offers might come to you in the mail, by phone or by email. If you’re interested in a new card, you can respond to these offers and apply to become a cardholder.
Keep in mind that you haven’t actually applied for the credit card when you receive one of these offers. But if you’re interested in a new credit card, you can use pre-qualified or pre-approved offers as an opportunity to compare options before applying.
If you’re interested in either pre-qualification or pre-approval but haven’t been contacted by a credit card lender, what’s your next step? One option is to look online or go directly to a credit card issuer.
How to get pre-approved for a Capital One credit card
Capital One’s pre-approval toolmakes it easy to find out if you’re pre-approved for card offers before you apply. Simply answer a few simple questions about yourself and review the offers you may be eligible for. Pre-approval is quick, and it won’t hurt your credit scores.
Learn more about how to get pre-approved for a Capital One credit card.
What’s next after getting pre-qualified or pre-approved?
When you apply for a card, you’ll share more of your financial information, including your income level. That’s also when a card issuer will conduct a hard inquiry.
If you decide you want to apply, that’s a good time to take a closer look at things like interest rates and other card terms to determine which card is right for you. Many cards offer additional benefits, including:
- Cash back rewards
- Travel rewards
- $0 fraud liability for unauthorized purchases
- Travel insurance
- Premier access to events
How to opt out of pre-qualification or pre-approval offers that use credit bureau information
If you’d rather not receive pre-qualified or pre-approved credit card offers, you can opt out by calling toll-free 888-5-OPT-OUT—that’s 888-567-8688—or by visiting OptOutPrescreen.com.
Pre-qualification vs. pre-approval FAQ
Want to know more? Here are a few frequently asked questions about pre-qualification and pre-approval:
What’s better: pre-qualification or pre-approval?
Both pre-qualification and pre-approval mean your financial history has been reviewed by a lender, putting you a step closer to potentially securing a line of credit. Neither is necessarily better than the other.
Does pre-qualification guarantee a credit card?
With pre-qualification, lenders review your creditworthiness using basic financial information. But this doesn’t guarantee approval. The same goes for pre-approval.
How can I increase my chances of getting a pre-qualification or pre-approval offer?
Credit card issuers typically look into a number of factors related to credit history and income. Here are a few things you can do to potentially receive more offers:
- Make on-time payments on your accounts.
- Maintain a low credit utilization ratio.
- Check your credit to have a better understanding of your financial standing.
Keep in mind that requirements can vary by issuer and card.
Does pre-qualification or pre-approval affect your credit score?
Here’s how pre-qualifications and pre-approvals might impact your credit during each stage of the process:
- During the pre-qualification and pre-approval process: Simple reviews of your credit, including checks that lead to pre-qualified or pre-approved credit card offers, usually use soft inquiries and don’t affect your credit scores.
- During the application process: A second type of credit check, called a hard inquiry, is made only after you respond to a card offer by applying for the card. FICO® explains that a hard inquiry typically has only a minor effect on your FICO score if most other factors—like timely bill payment—are in order. This full credit check will help determine whether you could be approved to get the card. If you’re approved, the issuer must offer you the same terms that appeared in the original pre-qualified or pre-approved offer.
- During the credit evaluation: If your credit information changes in the time between the prescreening or preselection process and when you apply for a card, your eligibility might also change. For example, this might happen if there were any major changes to your employment, salary or debt.
Before you apply for a new credit card, learn more about how credit card applications can affect credit scores.
Pre-qualification vs. pre-approval in a nutshell
Getting pre-qualified or pre-approved for a credit card can be reassuring if you’re thinking about applying for a card and wondering which one you may be eligible for.
One way to get started? See if you’re pre-approved with Capital One. Simply answer some pre-approval questions, check out your eligible offers and decide which card may be right for you—with no risk to your credit score.
If you want to see where your credit score stands before you apply for a card, check out CreditWise from Capital One. CreditWise lets you access your TransUnion® credit reports and your VantageScore® 3.0 credit score. Using CreditWise won’t hurt your credit scores. Plus, it’s free for everyone, whether or not you’re a Capital One customer.
Pre-qualified and pre-approved credit card offers are often sources of confusion, but there are distinct differences between the two. These terms signify that a credit card issuer has assessed your financial information, indicating that you meet certain preliminary criteria to be considered for a card. Here’s a breakdown of the concepts covered:
Pre-Qualification vs. Pre-Approval
Pre-Qualification
- Definition: A basic review of your credit reports to gauge potential card eligibility.
- Process: The issuer assesses your credit history to determine if you might qualify.
- Guarantee: Not a guarantee of approval but provides an indication of potential approval if you proceed with the application.
Pre-Approval
- Definition: Involves a prescreening by the issuer to target individuals likely to qualify for a specific card.
- Rigor: Criteria are usually stricter than for pre-qualified offers.
- Indicator: A stronger indicator of approval, though not a guarantee.
Getting Offers and Applying
- Offer Process: Issuers establish initial eligibility criteria, then request lists of eligible individuals from credit bureaus.
- Receiving Offers: Offers can come via mail, phone, or email based on meeting initial criteria.
- Response: These offers serve as invitations to apply but do not mean automatic approval.
Applying for a Card
- Additional Information: When applying, more financial details (like income) are shared.
- Credit Check: Applying involves a hard inquiry that might temporarily affect credit scores.
After Pre-Qualification/Pre-Approval
- Decision-making: Assess card terms, benefits, such as cashback rewards, travel perks, and security features.
- Comparison: Use pre-qualified/pre-approved offers to compare different card options.
Opting Out and FAQs
- Opting Out: Can opt-out via phone or website if not interested in receiving such offers.
- FAQs: Covers questions about which is better, guarantee of approval, improving chances for offers, and the impact on credit scores.
Understanding the differences between pre-qualification and pre-approval is crucial. While they both suggest a step toward securing a line of credit, neither guarantees approval. Moreover, their impact on credit scores varies during different stages of the application process.
Capital One provides a pre-approval tool for easy checking of eligibility before applying, helping individuals gauge their options without affecting their credit scores. Additionally, for those interested, tools like CreditWise from Capital One offer access to credit reports and scores without affecting credit scores, aiding in making informed decisions before applying for a card.
