Everything you need to know about PREAPPROVALS!!!!

Pre-approved offers are one of the greatest tools that exist when it comes to credit approvals.

They can come in several types as well:

· Personal loan

· Auto loan

· Credit card

· Mortgage

However, they are not always 100% guaranteed, and no one wants to feel let down when proceeding.

If you have ever received a pre-approved offer in the mail, it was based on your personal info that the credit bureaus sold to creditors.

Creditors may ask the credit bureaus to send a list of people who meet certain criteria:

· Particular zip codes

· No accounts in collections

· No late payments in the last 12 months

Subprime lenders may ask for a list of people who meet the exact opposite criteria (because they feel these potential borrowers are desperate to take a bad deal)

· Low scores

· Recent late payments

· Particular zip codes

Preapprovals can also be prompted when you visit certain creditors' websites. But which ones can be trusted?

1. Those that give an exact APR, like the top pic and not like the bottom pic. Accurate pre-approvals perform a soft pull on your credit so they know exactly what limit and/or APR terms they would offer you.

2. Those that provide exact credit limits, like the one below. When these are shown to you before applying, this is one of the best signs.

However, even for offers with these three great factors, there's still a chance of denial.

Here are a few reasons you may be denied:

· There was a changed since the date the company initiated the soft pull.

· Other issues not involving your credit, like no income, citizen status, security alert/freeze, etc.

In this blog I will provide recommendations for companies you can get accurate pre-approvals from; however we cannot guarantee any approvals even if you are preapproved: We can not guarantee prime rates if approved. Also if there are any bureaus you do not want pulled, you may want to freeze them before applying. The company will either let the application go through, deny or ask you to lift the freeze,

Top six Companies offering Credit Card Preapprovals.

1. American Express (Typically pulls Experian however recently they've been using Both Experian and Transunion for some profiles)

2. Discover (Typically pulls Experian, sometimes Equifax)

3. Apple via Goldman Sachs (Typically pulls Transunion)

4. Capital One (Typically pulls all three)

5. BB&T (Typically pulls Equifax)

6. Credit one (Typically pulls Experian)

Top Five Companies Offering Preapprovals for Personal Loans

1. Sofi.com (Typically pulls from Experian.com

2. Discover Loans (Typically pulls all 3 bureaus)

3. Payoff.com (Typically pulls from Transunion, they will also review Sage stream and an employment verification)

4. Bestegg.com (Typically pulls from Experian)

5. Marcus.com (Typically pulls from Transunion)

Top Three Companies for Auto Loan Preapprovals

1. Capital One Auto Navigator (Typically pulls all 3)

2. Carvana.com (Typically pulls from Experian)

However here is a unique add.

3. Consumers Credit Union (Typically pulls from Transunion)

Here’s the data on them (This credit union and others are listed in our unreleased eBook)

· Hard pull for 60 days for all products except mortgages

· $50,000 max on Credit Cards

· $50,000 max on signature loans

· $150,000 max on Auto loans

· They do offer business credit cards and loans

· They check Chex Systems

· Transunion Pull for all products except mortgages

· You do not have to be a member to apply but must become one if auto loan is approved.

· Soft pull for membership

What I love about them and many other credit unions is they will often show you pre-approvals once you join anyway so once the account is logged in, you may already have offers generated.

Another cool feature is you can check your Apr% rate online however the credit decisions is still based upon your reports. I deiced to test it out, however not for me because that will be cheating but for someone with

1. Limited credit

2. Bad Credit

I was able to have my 18-year-old son allow me to use him as an example.

And a family member who just joined our program and she has bad credit.

Wanted to test out and see if the rates changed.

Here’s the results below:

For my son here’s his auto loan rates:

For my son here’s his personal loan rates:

For my family member with bad credit here’s her auto loan rates:

For my family member with bad credit here’s her personal loan rates:

Honestly for the auto loan on y sons preapproval, its not bad. However i would not allow him to take out a personal loan at 9%

For my family member the auto loan rate wasn’t too bad with the number of negative items she has but the purpose of her enrolling as to have a better outcome. The default rate increases tremendously when you take out a high interest rate loan.

The personal loan preapproval her......

All I will say is YIKES!!!!

This is why you shop around and have other credit unions you are with. SOME ARE BETTER THAN OTHERS IN DIFFERANT AREAS.

How to qualify to become a member?

You would pay a one-time, non-refundable $5 fee to our sponsor, the Consumers Cooperative Association, and then deposit and maintain a minimum $5 in your Membership Share/Savings Account.

Companies for Mortgage Preapprovals

(Real client preapproval below)

(DOUBLE CHECK BEFORE APPLYING AS BETTER.COM MAY HAVE STOPPED SOFT PULLS FOR PREAPPROVALS)

Well, the list started out a lot longer than what’s below honestly, however this company was a little more promising when it comes to the results.

Many companies that offer pre-approved mortgage decisions often require you to submit more info to move forward. Its often harder to receive a Preapproval letter without going through some loops and holes. This mortgage preapproval process was generated in about 2 minutes. You can actually take this letter to shop.

1. Better.com

· Pulls Transunion.

· Use Fico 4

· Will email you your prequalified letter to shop for houses immediately.

Preapproval letter good for 30 days.

Downside, once you move forward and apply, they would need to pull all three which in return can cause a denial if the information is a lot weaker on your Experian and TransUnion report.

Rates and denials

When searching for credit, your rate should default be the deciding factor and will tell you what position you are in credit wise.

Excellent Apr% rates will always vary but below will give you a good idea where you would want to be:

· Auto loans under 3%

· Personal Loans under 7% (or within 1-2% of the lowest amount listed on their site)

If you received a denial you are entitled to know why, and you will receive a adverse reaction email/letter explaining why.(Example show below)

That is your cheat sheet because now you at least know exactly what this company doesn’t like. Your next steps to fix those issues and come back later!

Why Get Preapproved or Prequalified?

When it comes to making a large purchase, whether that be a home, a new car, or any other type of purchase, knowing where you stand is extremely important. Getting prequalified/preapproved is a great way to figure out where you stand when it comes to the type of offers you may have available to you. If you’re someone who is unsure of their exact credit score and what is available for you, then a prequalification/preapproval is a great way to begin the process of figuring out what loans suit you and are attainable, with only a soft credit pull being conducted.

A preapproval shows sellers and dealers that you are serious about making a purchase with them. Beyond the broad information that a prequalification provides, the preapproval has already zeroed in on the exact rate at which your loan will be and is as good as having cash-in-hand when you show up to the bargaining table. This process in most cases will require a hard credit inquiry which may affect your credit score slightly, but the tradeoff is that you’ll have a little more confidence knowing where you stand in that creditors eye.

The Bottom Line

If you are in the market for a new home, large purchase, or automobile, securing a prequalification or preapproval is an essential part of that process. If you are just beginning your hunt and not sure about the best loan for you, looking out for loans that offer prequalification/preapprovals is a great place to get started. There will be no impact on your credit score, and you’ll get a general idea of what is out there for you and your situation. If you are already beyond that step and serious about making your purchase, a preapproval will only make you an even stronger candidate and that much more likely to secure the loan that best fits your needs.

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