Does Getting Preapproved Affect Your Credit?

Quick Answer

A preapproval gives helps you gauge your likelihood of approval for new credit, and the interest rate you could receive. While a credit card preapproval doesn’t affect your credit, a preapproval for a mortgage or car loan could cause a minor but temporary decrease in your credit score.

Shot of a young woman holding her credit card while using her cellphone to apply for credit card preapproval at home

What Is Preapproval?

Preapproval is when a lender or creditor determines you meet specific criteria that make you a strong candidate for a loan or credit card. It's important to keep in mind, though, that it doesn't guarantee final approval.

Depending on the situation, the preapproval process may involve pulling your credit using a soft inquiry or a hard inquiry, which can have an impact on your credit scores. Here's how it can differ based on the type of loan.

Preapproval for a Mortgage

Getting a mortgage preapproval is an essential step in the homebuying process. Having a preapproval letter in hand gives you tentative loan approval with estimated terms and can strengthen your offer on a home.

Unlike other loan options, the mortgage preapproval process requires a lot of information, including your income, assets, debts, employment history and other pertinent details. The lender then performs a hard inquiry on one or more of your credit reports.

Mortgage preapprovals typically last 30 to 60 days, after which you may need to provide more recent documents to ensure your creditworthiness hasn't changed.

Learn more: What Documents Are Needed for a Mortgage Preapproval?

Preapproval for a Car Loan

A preapproval for a car loan lets you know how much money you can borrow and can also help you negotiate better terms with the dealer. As with a mortgage preapproval, you'll typically need to fill out an application, providing personal information such as your monthly income, debt balances and employment history.

A car loan preapproval typically lasts 30 to 60 days and can affect your credit because the lender will perform a hard credit inquiry to review your credit.

In some cases, however, auto lenders may prescreen your credit history and send you a preapproval offer in the mail without you submitting an application. In this case, the inquiry is soft and won't affect your credit score.

Preapproval for a Credit Card

With credit card preapproval, you may seek out a specific card you'd like to get preapproved for or receive prescreened offers by email or in the mail from credit card issuers.

It's important to note that credit card issuers may use the terms "preapproval" and "prequalify" interchangeably. Either way, it typically involves a soft credit inquiry.

You can then decide whether to accept the offer and complete the application process—just be sure you know all the card's terms before applying. Final approval is still subject to a hard credit inquiry for a more thorough review of your credit along with your income, debt balances and other factors.

Preapproval for a Personal Loan

As with credit cards, you can typically receive preapproval for a personal loan with only a soft credit pull, which won't affect your credit scores. A preapproval for a personal loan is a way to determine if you're eligible for a loan before formally applying and triggering a hard credit inquiry.

In this case, the lender reviews your credit, income and other factors to determine if you meet the loan requirements. Additionally, the lender will provide you with an estimate of your potential loan amount, annual percentage rate (APR) and fees with the loan.

Personal loan lenders may also send you prescreened offers, which provide some basics about what you may qualify for.

Does Preapproval Affect Your Credit Score?

Preapproved offers for credit cards and personal loans typically don't impact your credit score, while mortgage and auto loan preapproval typically involve a hard inquiry, which affects your credit.

Even if a lender doesn't check your credit during the preapproval process, they'll likely run a hard inquiry once you accept the offer and submit an official application.

Credit inquiries have a minimal impact on your FICO^® Score^☉ ^Θ, reducing it by less than five points for most people. Additionally, hard inquiries only affect your FICO^® Score for 12 months.

The good news is that if you're shopping around for a mortgage loan, auto loan or student loan, FICO will combine all hard inquiries into one for scoring purposes. The only catch is that you have to complete your rate shopping within 45 days—or 14 days for older FICO^® Score versions.

However, that's not the case for credit cards and other loan types, so be careful about multiple applications for those types of credit.

Benefits of Getting Preapproved

Getting preapproved for a mortgage or auto loan can give you an idea of your borrowing limit so you can shop for a home or car with confidence. Having a lender willing to finance your home purchase makes you a more attractive candidate to a home seller.

Loan and credit card preapproval offers significant benefits, such as:

Provides a degree of certainty: When you receive a preapproved offer, it's not a guarantee of approval. However, it indicates you meet the card issuer's basic eligibility requirements so that you can proceed with the application process with at least some confidence.
No damage to your score depending on loan type: Preapproval for credit products other than mortgage and auto loans typically only requires a soft credit pull to determine your eligibility for a credit card.
Allows you to compare offers: One of the best ways to maximize your savings on a mortgage, auto or personal loan is to compare preapproval offers from different lenders.
Shows your buying power: If you're applying for a mortgage, auto loan or personal loan, the preapproval process will typically tell you how much you can borrow based on the information you provided. From there, you can determine how much to request based on your budget.
May include promotions: Many credit card preapprovals offer valuable benefits such as an introductory 0% APR for a specific period or a higher welcome bonus.
Simplifies the application process: When you go through preapproval with a lender, they'll already have most of your information on file when you're ready to submit an official application. This can help streamline the application process and save you a little time.

Earn rewards for your spending

See your top credit card matches based on your credit profile and spending habits.

Get the right card to earn cash back or points on your purchases and maximize your perks.

Apply for rewards cards matched for you and that you’re more likely to qualify for.

See your offers

How to Get Preapproved for Credit

Depending on the type of credit you're applying for, preapproval is often a good first step in the credit approval process. It gives lenders and creditors a glimpse of your creditworthiness and gives you insight into the loan or credit card you might receive.

Follow these steps to get preapproved for credit:

Check your credit. Before starting the process, it's wise to get an idea of where your credit stands. You can get a free copy of your Experian credit report and FICO^® Score to see where you stand. You can also get access to your credit reports from all three major credit bureaus at AnnualCreditReport.com. Checking your own credit does not affect your credit score.
Increase your approval odds. When reviewing your credit reports, identify any issues impacting your credit scores and take the necessary steps to address them and hopefully improve your credit score.
Gather your personal documents. Since final approval will ultimately require verifying your information, ensure the information you submit for preapproval is accurate from the start. Refer to your pay stubs, tax documents, account statements and other essential documents when entering your financial and employment information.
Submit a preapproval application. Provide your personal and contact information, annual income, employment details and financial information. For credit cards, personal loans and auto loans, a lender may send you a prescreened offer, in which case you simply need to submit a formal application to proceed.
Agree to a soft credit check. Since a soft inquiry doesn't affect your credit score, you can prequalify with multiple lenders to find the best interest rate available.
Find out the lender's decision. If approved, you'll find out your borrowing amount, interest rate, repayment term and estimated payment. Generally, the better your credit score, the lower the interest rate you'll pay.
Submit a formal application. The lender's initial approval is based on the information you've given them up until now. The final step involves supporting your application information by uploading supporting documents like your bank statements and tax returns.

The Bottom Line

A preapproval isn't a guarantee for new credit, but it can help you determine whether you're likely to be approved. If not, take steps to optimize your credit before you apply. Thankfully, there are many ways to improve your credit.

To know where your credit stands before applying for preapproval or anytime, consider getting free credit monitoring from Experian. You can see current versions of your FICO^® Score and credit report, and you'll get updates when changes occur.

How Good Is Your Credit Score?

300 credit score 301 credit score 302 credit score 303 credit score 304 credit score 305 credit score 306 credit score 307 credit score 308 credit score 309 credit score 310 credit score 311 credit score 312 credit score 313 credit score 314 credit score 315 credit score 316 credit score 317 credit score 318 credit score 319 credit score 320 credit score 321 credit score 322 credit score 323 credit score 324 credit score 325 credit score 326 credit score 327 credit score 328 credit score 329 credit score 330 credit score 331 credit score 332 credit score 333 credit score 334 credit score 335 credit score 336 credit score 337 credit score 338 credit score 339 credit score 340 credit score 341 credit score 342 credit score 343 credit score 344 credit score 345 credit score 346 credit score 347 credit score 348 credit score 349 credit score 350 credit score 351 credit score 352 credit score 353 credit score 354 credit score 355 credit score 356 credit score 357 credit score 358 credit score 359 credit score 360 credit score 361 credit score 362 credit score 363 credit score 364 credit score 365 credit score 366 credit score 367 credit score 368 credit score 369 credit score 370 credit score 371 credit score 372 credit score 373 credit score 374 credit score 375 credit score 376 credit score 377 credit score 378 credit score 379 credit score 380 credit score 381 credit score 382 credit score 383 credit score 384 credit score 385 credit score 386 credit score 387 credit score 388 credit score 389 credit score 390 credit score 391 credit score 392 credit score 393 credit score 394 credit score 395 credit score 396 credit score 397 credit score 398 credit score 399 credit score 400 credit score 401 credit score 402 credit score 403 credit score 404 credit score 405 credit score 406 credit score 407 credit score 408 credit score 409 credit score 410 credit score 411 credit score 412 credit score 413 credit score 414 credit score 415 credit score 416 credit score 417 credit score 418 credit score 419 credit score 420 credit score 421 credit score 422 credit score 423 credit score 424 credit score 425 credit score 426 credit score 427 credit score 428 credit score 429 credit score 430 credit score 431 credit score 432 credit score 433 credit score 434 credit score 435 credit score 436 credit score 437 credit score 438 credit score 439 credit score 440 credit score 441 credit score 442 credit score 443 credit score 444 credit score 445 credit score 446 credit score 447 credit score 448 credit score 449 credit score 450 credit score 451 credit score 452 credit score 453 credit score 454 credit score 455 credit score 456 credit score 457 credit score 458 credit score 459 credit score 460 credit score 461 credit score 462 credit score 463 credit score 464 credit score 465 credit score 466 credit score 467 credit score 468 credit score 469 credit score 470 credit score 471 credit score 472 credit score 473 credit score 474 credit score 475 credit score 476 credit score 477 credit score 478 credit score 479 credit score 480 credit score 481 credit score 482 credit score 483 credit score 484 credit score 485 credit score 486 credit score 487 credit score 488 credit score 489 credit score 490 credit score 491 credit score 492 credit score 493 credit score 494 credit score 495 credit score 496 credit score 497 credit score 498 credit score 499 credit score 500 credit score 501 credit score 502 credit score 503 credit score 504 credit score 505 credit score 506 credit score 507 credit score 508 credit score 509 credit score 510 credit score 511 credit score 512 credit score 513 credit score 514 credit score 515 credit score 516 credit score 517 credit score 518 credit score 519 credit score 520 credit score 521 credit score 522 credit score 523 credit score 524 credit score 525 credit score 526 credit score 527 credit score 528 credit score 529 credit score 530 credit score 531 credit score 532 credit score 533 credit score 534 credit score 535 credit score 536 credit score 537 credit score 538 credit score 539 credit score 540 credit score 541 credit score 542 credit score 543 credit score 544 credit score 545 credit score 546 credit score 547 credit score 548 credit score 549 credit score 550 credit score 551 credit score 552 credit score 553 credit score 554 credit score 555 credit score 556 credit score 557 credit score 558 credit score 559 credit score 560 credit score 561 credit score 562 credit score 563 credit score 564 credit score 565 credit score 566 credit score 567 credit score 568 credit score 569 credit score 570 credit score 571 credit score 572 credit score 573 credit score 574 credit score 575 credit score 576 credit score 577 credit score 578 credit score 579 credit score

580 credit score 581 credit score 582 credit score 583 credit score 584 credit score 585 credit score 586 credit score 587 credit score 588 credit score 589 credit score 590 credit score 591 credit score 592 credit score 593 credit score 594 credit score 595 credit score 596 credit score 597 credit score 598 credit score 599 credit score 600 credit score 601 credit score 602 credit score 603 credit score 604 credit score 605 credit score 606 credit score 607 credit score 608 credit score 609 credit score 610 credit score 611 credit score 612 credit score 613 credit score 614 credit score 615 credit score 616 credit score 617 credit score 618 credit score 619 credit score 620 credit score 621 credit score 622 credit score 623 credit score 624 credit score 625 credit score 626 credit score 627 credit score 628 credit score 629 credit score 630 credit score 631 credit score 632 credit score 633 credit score 634 credit score 635 credit score 636 credit score 637 credit score 638 credit score 639 credit score 640 credit score 641 credit score 642 credit score 643 credit score 644 credit score 645 credit score 646 credit score 647 credit score 648 credit score 649 credit score 650 credit score 651 credit score 652 credit score 653 credit score 654 credit score 655 credit score 656 credit score 657 credit score 658 credit score 659 credit score 660 credit score 661 credit score 662 credit score 663 credit score 664 credit score 665 credit score 666 credit score 667 credit score 668 credit score 669 credit score

670 credit score 671 credit score 672 credit score 673 credit score 674 credit score 675 credit score 676 credit score 677 credit score 678 credit score 679 credit score 680 credit score 681 credit score 682 credit score 683 credit score 684 credit score 685 credit score 686 credit score 687 credit score 688 credit score 689 credit score 690 credit score 691 credit score 692 credit score 693 credit score 694 credit score 695 credit score 696 credit score 697 credit score 698 credit score 699 credit score 700 credit score 701 credit score 702 credit score 703 credit score 704 credit score 705 credit score 706 credit score 707 credit score 708 credit score 709 credit score 710 credit score 711 credit score 712 credit score 713 credit score 714 credit score 715 credit score 716 credit score 717 credit score 718 credit score 719 credit score 720 credit score 721 credit score 722 credit score 723 credit score 724 credit score 725 credit score 726 credit score 727 credit score 728 credit score 729 credit score 730 credit score 731 credit score 732 credit score 733 credit score 734 credit score 735 credit score 736 credit score 737 credit score 738 credit score 739 credit score

740 credit score 741 credit score 742 credit score 743 credit score 744 credit score 745 credit score 746 credit score 747 credit score 748 credit score 749 credit score 750 credit score 751 credit score 752 credit score 753 credit score 754 credit score 755 credit score 756 credit score 757 credit score 758 credit score 759 credit score 760 credit score 761 credit score 762 credit score 763 credit score 764 credit score 765 credit score 766 credit score 767 credit score 768 credit score 769 credit score 770 credit score 771 credit score 772 credit score 773 credit score 774 credit score 775 credit score 776 credit score 777 credit score 778 credit score 779 credit score 780 credit score 781 credit score 782 credit score 783 credit score 784 credit score 785 credit score 786 credit score 787 credit score 788 credit score 789 credit score 790 credit score 791 credit score 792 credit score 793 credit score 794 credit score 795 credit score 796 credit score 797 credit score 798 credit score 799 credit score

Resources

Credit Score

Credit Report

Fraud & Identity Theft

Improve Credit

Personal Finance

Calculators

Does Getting Preapproved Affect Your Credit?

In this article: