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How to Evaluate a Credit Card Offer You Received in the Mail

Always review credit card offers before applying. Check for a reputable card issuer, competitive APR, benefits, rewards, and no confusing fine print.

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If you've recently received a pre-approved credit card offer via mail or email, chances are you're at least a little interested. Most offers are designed to grab your attention by highlighting all the perks front and center. No matter how enticing an offer seems, you should always check the fine print before applying to make sure you've reviewed both the good and the bad. Here's how you can decide whether to take the card offer or send it straight to the shredder.

Check the card issuer

Before you dig any deeper, confirm that the card offer is from a legitimate and reputable bank. If you've never heard of the company, a quick internet search can give you some background. While you're browsing, read through a few reviews to get an idea of whether other customers like or dislike that bank. Lots of negative reviews are a sign that you don't want to do business with that card issuer.

Determine the cost

Consider the annual fee, interest rate, and cost of transactions you plan to make. If you travel internationally, check whether the card will add a foreign transaction fee to your purchases. For balance transfer credit cards, check the balance transfer fee, even if the card has a promotional rate. And if the card has a promotional offer that you're considering, the timing matters. A competitive promotional rate will typically last between 12 and 18 months.

Preview the perks

Credit cards with the best perks tend to carry an annual fee, but that's not necessarily a dealbreaker. The fee may be worth paying, particularly when the benefits offset the fee. For instance, paying a $95 annual fee on a card that waives airline checked baggage fees will pay off after just two flights where you check your bags.

On the other hand, a card can be packed with perks and be a bad card for you. Evaluate the benefits against your current lifestyle to be sure you can take advantage of them. It's not worth paying an annual fee for amazing features that you'll never use.

Look at the rewards

Consider how easily you can earn rewards based on the program and your typical spending. Cash rewards are more versatile than miles or points, but miles and points are still valuable as long as they're easy to earn and easy to redeem. The offer is less attractive, however, if you have to spend more money to earn a decent amount of rewards.

Consider your credit

A pre-approved offer doesn't mean guaranteed approval. It only means that the card issuer thinks you may qualify based on its prescreening. Once you complete an application, the card issuer will do a full credit check and approve or deny your application. You could be denied for a variety of reasons, for instance, if your FICO® Score has dropped since the offer was mailed to you.

Watch out for red flags

Avoid cards that have unusual terms like an upfront processing or activation fee or a fee to raise your credit limit. Likewise, don't accept an offer for a card with an abnormally high interest rate or with no grace period. Beware of an offer that guarantees approval—it could very well be a scam to collect money or personal information from you.

Comparing your offer to other cards you might qualify for is a good way to tell whether you have a solid offer. Once you've decided what to do with the offer, shred the application or any other documents with your name and personal info to avoid identity theft. Finally, if you prefer not to receive offers for new credit cards, you can stop most offers by going to optoutprescreen.com.

LaToya Irby

LaToya Irby is a financial writer with over 14 years of experience. She's been quoted and published as a credit expert in several major publications including USA Today, U.S. News and World Report, TheBalance.com, and The Chicago Tribune.