Does Opting Out Improve Your Credit Scores?

It’s one of the more obscure FICO scoring myths floating around the Internet. Does
choosing to opt out of preapproved credit card offers improve your credit scores, or not?
And if not, then why not?

First things first, what’s “opting out?” Opting out, which can be done for free at
www.optoutprescreen.com, removes your name from any list sold by the credit bureaus
that has been prequalified. This will prevent any lender or insurance company from
filling up your mailbox with unsolicited offers for credit or insurance.

Opting out doesn’t have any impact on your credit scores, at all. The only way your
credit scores can be impacted, by anything, is if it changes information on your credit
reports. Opting out isn’t noted or reported by any of the credit reporting agencies so it’s
technologically impossible for the act to have any influence over your credit scores.

It appears this rumor started, like most of them, in the mortgage industry. Mortgage
brokers would sometimes advise their clients to opt out so the number of “prescreen”
inquiries would remain low. The hypothesis was that fewer inquires equal a higher

Additionally, the myth suggested that fewer solicitations would result in less credit card
debt, which would result in higher credit scores.

These are both erroneous assumptions. First off, prescreen inquiries are “soft” inquiries,
which means they have no impact on your credit scores, at all. You can have 1, 10, or
100 of them and they all have the same impact…nil. So, avoiding them doesn’t do your
scores any good.

While it’s true that not having credit card debt is good for your scores, the act of avoiding
credit cards doesn’t improve it. Further, simply receiving fewer credit card offers
certainly doesn’t mean you’re not going to get into credit card debt. You can get in as
much debt on one credit card as you can with five cards, depending on the credit limits.

So the next time you are advised to opt out of credit card offers, do it. It’s a smart way
to reduce your junk mail, which can reduce your exposure to mail thieves who use the
information to fraudulently apply for credit card offers. But, don’t think it’s going to have

any positive influence on your credit scores.

“The Credit Guru”, Longtime FICO Insider & Credit Industry Authority President Of The Ulzheimer Group, LLC
John Ulzheimer is a nationally recognized expert on credit reporting, credit scoring and identity theft. He is the President of The Ulzheimer Group, the Director of Credit Education at DisputeSuite.com, Credit Expert at CreditSesame.com and the credit blogger for Mint.com. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry. He has served as a credit expert witness in more than 150 cases and has been qualified to testify in both Federal and State court on the topic of consumer credit.

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