NEW YORK (MainStreet) — Credit card solicitations have been on the rise during the past few years as issuers seek to attract consumers with solid credit histories.
How do financial institutions know you’re among the credit elite? According to John Ulzheimer, president of consumer education for SmartCredit.com, issuers pay various sources, including the three major credit bureaus, Experian, Equifax and TransUnion, for lists of consumers who have passed through a pre-screening.
“Pre-screening is the process whereby the bureaus apply criteria that must be met by the consumers in order for them to make it onto the final list,” Ulzheimer says. “For example, John's bank might buy a list of 1 million consumers who live in the Atlanta area (by ZIP code matching) who all have FICO scores greater than 720 and have don't have any late payments in the past 24 months.”
The pre-screening is intended to eliminate risky prospects, as using these lists requires financial institutions to make a firm offer of credit to the person being solicited. This is good news for those who in the market for a new line of credit, but bad news for those who have little to no interest in adding another card to their credit arsenal.
Fortunately, those not in the market for a new credit card can stop their mailbox from being flooded with solicitations.
First, the Federal Trade Commission (FTC) has a website devoted to helping consumers opt out of pre-screenings called OptOutPrescreen.com. And you can also call 1-800-5-OPT-OUT if you’re less digitally inclined. Both options require consumers to provide their name, address, Social Security number and date of birth to opt of receiving credit offers via various channels.
Consumers are then given the option of opting out of credit offers entirely or just for five years. There is also an option to opt in, but don’t let that confuse you.
Ulzheimer says that unless consumers formally opt out, bureaus and other information providers don’t need a person’s authorization to include them on a prescreening list.