The reports of snail mail’s death have been greatly exaggerated!

Why? Just look at all those offers for credit or personal loans that show up. You can also turn on Sirius XM radio and get a steady dose of commercials touting online lending offers.

While most are legitimate and can actually help, some are traps. They may sound enticing – “You’re preapproved for a no interest line of credit…”  But, then you actually apply for that enticing line of credit and are declined.



A pre-approved line of credit is not exactly what it sounds like. You received that letter in snail mail because you fit the basic profile of someone who might be approved. Lenders will request from the credit bureau a list of people who meet basic criteria, typically a FICO score that falls in a certain range. This is referred to as a soft credit pull since an actual inquiry in to your credit report has not yet been made by the lender.

You’re feeling good about the prospects of getting an attractive loan, so you complete the application. Now, the lender will do what is called a hard credit pull, and this does show up on your credit report as a inquiry from that lender. The hard credit pull enables the lender will see your entire credit report and look at other variables in your report, such as debt-to-income levels, delinquencies and bankruptcies, and the number of credit inquiries recently made. There are many variables that go in to creating your FICO score, but just because two individuals have the same score, e.g., 660, doesn’t mean a lender will approve both applicants. A lender will determine what variables are most important to it and will then weight them to create a credit decision. Oftentimes, a lender may decline an applicant with say a 675 FICO score and approve one with a 650 FICO score.

Another issue is the varying scores reported by the different credit bureaus. You may be following your credit report with Experian and happy to see a 718 FICO score when, in fact, Transunion has your score sitting at 678. Why the discrepancy? The credit bureaus are independent businesses that collect data on you from various financial institutions. A financial institution may report to Transunion and not to Experian. Therefore, that late payment shows up on one but not the other. Or they may categorize you account balances differently or weight the importance of variables differently. If you apply for a line of credit with a lender and they do a hard pull with a credit bureau that has a lower score for you, you may get rejected due to this plus the other variables mentioned above.

After what looks like a promising offer and opportunity for an attractive loan, turns in to a decline and yet another credit inquiry on your credit report, which will affect your FICO score. While the hit on your FICO score is not significant with a credit pull, it does create another credit inquiry that can, combined with other factors, cause a rejection of your next credit application.

It’s best to ditch the credit offers you receive in snail mail and go online to a source like SweetPay that will have its multiple personal loan lending options evaluate your credit profile without doing a hard credit pull and, if approved, present you with legitimate offers that fit your credit profile. Once you accept the offer, you can feel confident in actually receiving that loan you desire.

~ David Weyher