topic Re: Pre-qualify on CreditKarma while under 21? in General Credit Topics

Pre-qualify on CreditKarma while under 21?

Subexistence — Sun, 02 Apr 2017 20:37:19 GMT

The credit card act of 2009 made it a law so that people under 21 can't prequalify but yet I ws able to pull it off in creditkarma's site.

-->https://www.creditkarma.com/credit-cards/search-cc

Then click the app at the top that says 'Find out if you have been pre-qualified'

In any case the above image shows the terms of prequalification. It seems creditkarma is sending a lot of information over for the process.

Once you agree and continue it will display your offers and in my case it was Amex BCE and Amex Everyday.

You can always revisit to see your prequalified offers by clicking 'don't forget....'

or use the below link

https://www.creditkarma.com/credit-cards/prequalified?

My Amex BCE prequalify offer was spend $500 to get $150. This offer did not include the advertised restaurant offer.

The default offer was $100 for $1000 spend + $200 for $2000 spend at restaurants.

My prequal offer was 15,000 points for 1000 spend with Everyday card.

The default Everyday offer was 10,000 points for$1000 spend.

So what do you guys think of this way to pre-qualify while under 21?

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Mon, 03 Apr 2017 02:18:25 GMT

I didn't even know that one could obtain pre-qualified offers through CK.

Re: Pre-qualify on CreditKarma while under 21?

sjt — Mon, 03 Apr 2017 04:05:39 GMT

@Anonymous wrote:
I didn't even know that one could obtain pre-qualified offers through CK.

Its a new thing they started a few months ago.

Re: Pre-qualify on CreditKarma while under 21?

Subexistence — Mon, 03 Apr 2017 14:24:39 GMT

Another tings to note is my oldest accont and AAoA are both 5 months so I don't have FICO yet? Does that mean pre-qualificiation on CK is done through Vantage?

Re: Pre-qualify on CreditKarma while under 21?

sjt — Mon, 03 Apr 2017 20:45:03 GMT

You slipped throught the cracks, but if you take them sign up for those offers they will pull credit and you could get turned down or ask for more information like proof of income.

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Tue, 04 Apr 2017 01:07:59 GMT

In the CK it says my Chase pre-qualified offers are Freedom, FU and SP. On the Chase site it says Slate, FU, SP. I wonder why the inconsistency.

Re: Pre-qualify on CreditKarma while under 21?

Subexistence — Tue, 04 Apr 2017 03:22:05 GMT

@Anonymous wrote:
In the CK it says my Chase pre-qualified offers are Freedom, FU and SP. On the Chase site it says Slate, FU, SP. I wonder why the inconsistency.

The terms and conditions in one of my pictures state CreditKarma sends the information used for pre-qualification. At the time I recieved those pre-qualifications, my fico scores were not generated yet although creditscorecard generated my EX today of 732. My theory is that CK uses Vantage scores for the pre-qualificaion and so that's why they were able to pre-qualify while my FICOs hadn't generated yet. However I can't be sure because I got my first FICO score the day after I used the pre-qualification. Also I recieved Amex offers which use EX which was also the first score I got.

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Tue, 04 Apr 2017 12:01:15 GMT

Well, if CK is using VantageScores for pre-qualification, then unless that creditor (which I don't know of any) uses VantageScores than the pre-qualification is basically bogus, no?

Re: Pre-qualify on CreditKarma while under 21?

Subexistence — Tue, 04 Apr 2017 13:23:50 GMT

@Anonymous wrote:
Well, if CK is using VantageScores for pre-qualification, then unless that creditor (which I don't know of any) uses VantageScores than the pre-qualification is basically bogus, no?

It would definitely be bogus except in the case where one does not have a fico yet. I would think a cc company can make more profit from luring in a high vantage scoring 5 month old profile over ignoring the profile. It'll be interesting to see if anyone with no fico score yet applies through CK prequalification and we see the result of that application.

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Tue, 04 Apr 2017 20:37:27 GMT

But if the person is pre-qualified using VantageScore through CK, but the creditor uses FICO scores and the applicant doesn't have a FICO score to pull when the creditor tries to obtain one, wouldn't the applicant be denied?

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Tue, 04 Apr 2017 21:11:17 GMT

I feel like I've read before on here that credit karma prequalifications are useless..

Re: Pre-qualify on CreditKarma while under 21?

Subexistence — Tue, 04 Apr 2017 21:12:04 GMT

@Anonymous wrote:
But if the person is pre-qualified using VantageScore through CK, but the creditor uses FICO scores and the applicant doesn't have a FICO score to pull when the creditor tries to obtain one, wouldn't the applicant be denied?

In this case we wouldn't know if the cc company would just use the vantage score or they will still only accept fico due to Vantage pre-qualify being relatively new. The only way to know is get someone with 5 month old history with CK prequals to try to apply for those preqaulification offers.

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Wed, 05 Apr 2017 00:41:47 GMT

@Subexistence wrote:
@Anonymous wrote:
But if the person is pre-qualified using VantageScore through CK, but the creditor uses FICO scores and the applicant doesn't have a FICO score to pull when the creditor tries to obtain one, wouldn't the applicant be denied?
In this case we wouldn't know if the cc company would just use the vantage score or they will still only accept fico due to Vantage pre-qualify being relatively new. The only way to know is get someone with 5 month old history with CK prequals to try to apply for those preqaulification offers.

I've never heard of a credit card company using a different scoring model if there is no presence of a FICO score.

Re: Pre-qualify on CreditKarma while under 21?

Thomas_Thumb — Wed, 05 Apr 2017 01:22:35 GMT

It is a standard practice in credit card decisioning. Discover card uses L2C which is able to generate a score based on utility and rent payment history.

Here is what Discover looked at when they granted DD a credit card with no "standard" credit history and no Fico score. As I recall her L2C score was 665 at the time.

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Wed, 05 Apr 2017 02:30:12 GMT

So their own model, not VS 3.0 correct?

Re: Pre-qualify on CreditKarma while under 21?

Thomas_Thumb — Wed, 05 Apr 2017 04:46:03 GMT

No L2C is a 3rd party credit scoring model that was developed specifically to score the "unscoreable".

The parent company that created L2C was an independent until late 2014 when it was acquired by TransUnion.

An alternative product to L2C that was developed through some collaboration between with Fair Isaac and LexisNexis is Fico XD - it also targets those without "standard" credit histories.

TransUnion: Link2Credit Thin File

"Back in June 2007, TransUnion, in partnership with L2C Inc., developed the thin file model named Link2Credit. This model leverages information such as payday loans, rental payments, and debt information along with cellular plan data to develop an individual's credit score. The model helps lenders predict the likelihood of a consumer becoming delinquent on payments and / or charge-off occurring in the next 12 months".

For additional (dated) info on L2C and competitive offerings check out this link:

https://s3.amazonaws.com/cfsi-innovation-files/wp-content/uploads/2017/02/05053225/The-Predictive-Value-of-Alternative-Credit-Scores.pdf

Fico XD appears to have been overshadowed by Fico 9 which also claims to be more inclusive.

Re: Pre-qualify on CreditKarma while under 21?

Anonymous — Wed, 05 Apr 2017 12:02:30 GMT

So what I was getting at that you've more or less verified is that if someone applies for a pre-qualified offer through CK and that person doesn't possess a FICO score yet, their CK VS 3.0 score will not be used for the application as was suggested earlier by someone else.

Re: Pre-qualify on CreditKarma while under 21?

Thomas_Thumb — Wed, 05 Apr 2017 13:57:22 GMT

CK has strong ties with TransUnion as evidenced by CK providing CBIS scores from TU and highlighting TU VantageScore 3.0 .

TU has a large portfolio of internally developed credit scoring models. It is hard to know the mechanics CK uses for pre-qualification which, as we know, is not the same as pre-approval. One option, used by Cap One for those new to credit, is TransUnion New Accounts 3.0. Not sure what Cap One does these days since their migration to VS 3.0.

Certainly different criteria (and possibly credit score versions) are used for pre-qual vs approval. Frankly, I'm not sure that the CC compnies are directly involved in the majority of pre-quals. They likely give "partners", like CK, some general guidelines for screening and focus on approval after getting an application.

Provided below is a link to a summary of TU scoring models. This document is from early 2015 - likely from from before the L2C acquisition integration (integration completed in 2016).

https://www.transunion.com/docs/rev/business/financialservices/FS_ModelsOverview.pdf

Re: Pre-qualify on CreditKarma while under 21?

sjt — Wed, 05 Apr 2017 16:43:39 GMT

Thanks Thomas for the information. Its very interesting.

Re: Pre-qualify on CreditKarma while under 21?

Subexistence — Sat, 08 Apr 2017 06:11:45 GMT

So TT, do you have any explanation for why those under 21 can slip under the age ban for pre-qualification?