How Credit Card Offers Damage Your Credit
While credit card offers might seem like a good thing, in fact, they can a lot of damage to your credit rating. Here's how.
We usually think of credit card offers, especially pre-approved credit card offers, as a good thing. Usually it indicates a reasonably high credit rating -- after all, companies aren't eager to offer credit to someone with a poor history. And in many ways, credit card offers are very positive.
However, two situations arise where these offers can be more trouble than they're worth: in terms of identity theft and in terms of negative marks on your credit score.
Identity theft
Mailed out credit card offers equal an identity thief's dream come true. Sitting in your mailbox all day while you're at work, all the identity thief has to do is wander door-to-door pretending to be delivering something. No one looks twice as he rifles through your mail and pockets the offers.
Because many offers are pre-approved, the identity thief now applies for credit in your name without the bother of obtaining your SSN. Worse yet, you probably won't find out about it until the collection agencies start calling or you get refused for credit. The thief often returns the name with false contact information so the agency can't reach you when charges start to default.
Negative marks
The other situation occurs when credit card offers create black marks on your credit. Often credit card offers claim to be pre-approved when in fact they aren't. That means that if you fill out the offer and send it back, the company conducts a credit check on you afterwards. And then may still refuse you the card.
The problem here is that every "hard pull" on your credit record (i.e., a check for credit purposes) creates a small black mark against you. It's not a big deal if you have an otherwise excellent score, but if you're teetering on the brink, it can push you over.
So even though credit card offers can be fun and flattering, it might be worth your time to request that companies not send you any more of them!
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