topic Re: "Preselected" by American Express in Credit Cards

"Preselected" by American Express

Anonymous — Sun, 09 Jan 2011 00:39:20 GMT

I just received a pre-selected letter from American Express for their Gold card. I honestly don't know why they would select me because I have only 4 months of credit history (extreme low ult and no baddies!) AND I was just denied by them when I applied for their Zync card last month or so. NOW, my understanding of American Express is that once they send you a pre-selected letter, it's a done deal. HOWEVER, I don't want the GOLD card because of the $125 annual fee, I want something without annual fee. SO HERE'S THE QUESTION, since I am pre-selected to receive a GOLD card, I should have no problem applying and getting approved for a card like the Zync or some of their other card with no annual fee, right?

Re: "Preselected" by American Express

trumpet-205 — Sun, 09 Jan 2011 01:09:21 GMT

My friend received a pre-approved letter from AMEX for Gold card as well. He apped and was denied instantly. AMEX told him his credit history wasn't long enough.

My guess is that charge cards have lower approval standard compare to credit cards, since you are required to pay in full each month. That means less risk for AMEX.

Re: "Preselected" by American Express

smc733 — Sun, 09 Jan 2011 01:07:40 GMT

That doesn't mean anything. If you fit a certain profile, they send you a prequal, it certainly means you're ballpark for approval standards, but it won't always go your way at app time.

Re: "Preselected" by American Express

Anonymous — Sun, 09 Jan 2011 01:24:33 GMT

If you read the fine print on most mailouts you will likely note that you have been "pre-selected" to APPLY for this card or that card, not actually approved to receive it. You might also read that "you have received this mailing because we have determined that you may--or may not--meet certainly eligibility criteria" at some point in the past.

Some of the more <ahem> mature contributors to this forum may remember in past days when folks received credit cards in the mail without ever applying for them (pets included.)

I suspect that half of the people who receive these notices are ultimately turned down (perhaps more than half with American Express and Discover.)

Re: "Preselected" by American Express

Anonymous — Sun, 09 Jan 2011 01:58:41 GMT

@trumpet-205 wrote:
My friend received a pre-approved letter from AMEX for Gold card as well. He apped and was denied instantly. AMEX told him his credit history wasn't long enough.

My guess is that charge cards have lower approval standard compare to credit cards, since you are required to pay in full each month. That means less risk for AMEX.

I don't get how that's less risk for AMEX because the way I think about this is that if someone suddenly lose their job and they charged $3000 on their AMEX charge card they can't PIF verus someone who charged $3000 on a CC and they have the ability to pay it over time so it won't go to collection. Someone please explain this...

Re: "Preselected" by American Express

smc733 — Sun, 09 Jan 2011 02:04:20 GMT

Because what you describe isn't how the typical person gets into credit trouble. They don't charge then loose their job. Usually they charge after loosing their job, or just irresponsibly. So rather than 6 months after a personal downfall, someone gets away with charging up each month, paying the minimums, until it all snowballs, leaving 6 months of debt, on a charge card, they can only make 1 month of charges, and if they fail to pay that, they're in trouble.

Re: "Preselected" by American Express

trumpet-205 — Sun, 09 Jan 2011 21:26:03 GMT

With charge card, if you failed to pay, the account is immediately suspended (you can't use it until you pay first). You also run into the risk of AMEX closing your account right away.

For credit card, you can pay the minimum and keep racking up debit. So in essence debit is increasing. It is until you miss payment for several months (3 to 6 months) that CCC sold debit to collection and charge off. By then CCC have lost a lot of money.

Charge card - 1 month of debit risk

Credit card - Several months of debit risk (revolving)

And yes, people do charge their card even after losing a job.

Re: "Preselected" by American Express

Anonymous — Mon, 10 Jan 2011 18:04:17 GMT

Pre-selected also is NOT the same as pre-approval. Often those letters do not soft pull your credit. I also received a pre-selected letter for AMEX Gold Premier Rewards Card but when I did the pre-approval link online and was "pre-approved" only for Zync (which I applied for and was approved). I would wait to apply with AMEX and let your history age a bit more.

Re: "Preselected" by American Express

Anonymous — Mon, 10 Jan 2011 18:32:12 GMT

"Preselected" could mean that gift subscription to "Food and Wine" magazine you have suddenly sold their mailing list.

There are many different databases/avenues that they can send "targeted" mailings to. Knowing full well that here will be a denial rate.

But what has better odds? Even mailings by specific ZIpcode in a state can give a better approval/account handling rate then just random mailings.

Someone subscribing to "Gamer Pro" probably not an AMEX desired customer, Cigar Aficionado- thats another story.

Re: "Preselected" by American Express

Anonymous — Mon, 10 Jan 2011 18:37:05 GMT

AMEX doesn't call it a "pre-approval". My legit pre-approval letters have all said you are "pre-selected". Like with most big bank pre-approvals, they still run your credit and might decline you.

If your letter has the OPT-OUT notice, then they did soft one of your reports to select you as a candidate.

Re: "Preselected" by American Express

smc733 — Mon, 10 Jan 2011 20:44:08 GMT

So much valuable information posted here.

On a quick side not, if you do get a mailed offer but don't see it show up on their "pre selected") option online, there's an option on the site "Respond to Mail Offer".