Despite rumors saying otherwise, opting out of credit cards and other credit offers does not increase your credit score.
You have the right to keep your name off promotional lists that credit bureaus sell to interested third parties, but it does not impact your score.
Placing a promotional suppression on your credit file means you:
- Receive less mail
- Reduce opportunities for identity theft
- Miss out on potentially lucrative credit offers
You can opt out of the promotional lists that each of the credit bureaus maintain for five years over the phone or online.
To opt out permanently, you must mail in a form. You can also opt out of other promotional lists to reduce the number of calls, mail, and emails you receive.
What is a promotional suppression to my credit file?
A promotional suppression of your credit file means that the major credit bureaus won’t sell your information to third parties, such as credit card issuers and insurance providers, which would otherwise occur routinely by default.
These companies purchase lists of people who meet a certain criteria, such as:
- Specific credit score range
- Recent bankruptcy filings or bankruptcy-free history
- High or low credit card debt
- Other credit items such as mortgage or student loans
This prescreening process filters the candidates that meet specific lending standards or are suited to certain credit accounts that are being offered. It’s essentially a targeted advertising method.
If you don’t want to be on the prescreened lists, you are permitted to place a promotional suppression on your credit file, in accordance with your rights under the Fair Credit Reporting Act (FCRA).
This ensure that your name and personal information is kept off the lists that are being sold to financial institutions.
What does opt out mean on credit report?
Promotional suppression is also known as opting out. Both terms refer to the same action, asking the credit bureaus to keep your information off the prescreened lists they send to third parties for promotional purposes.
Can you opt out of credit score?
When you opt out through credit bureaus, it does not mean you have opted out of having a credit score. It simply means you have opted out of the credit bureaus’ promotional lists.
The major credit bureaus, like Equifax, TransUnion, and Experian, will continue to have a file with your credit information.And creditors can report your credit-relation information. There is no way to opt out of these situations.
You can, however, minimize your credit history by never opening credit accounts or having bills in your name.
Is it a good idea to opt out of credit card offers?
For some people, it can be a good idea to opt out of credit card offers in order to receive less mail and avoid tempting but unnecessary offers.
Despite a belief with some that it may increase one’s credit score (apparently by around five points), opting out most definitely neither increases nor decreases it.
The lists are compiled through soft credit checks, the same technique used by credit monitoring companies and the like to take a high-level look at your credit.
Unlike hard checks, which can slightly lower your score, as they indicate a desire to open new accounts, soft checks do not damage your credit.
The main disadvantages of opting out are:
- Missing out on offers unavailable to most people
- Terms of prescreened offers can be more favorable or lucrative
- Increases awareness and knowledge of available credit terms
But there are also many advantages:
- Receive less mail, email, and phone calls related to unsolicited credit offers
- Lowers risk of identity theft since fewer applications with your information are created
- Helps avoid tempting credit offers you don’t need and may lead to burdensome debt
How opting out impacts old debt and mortgage shopping
One of the main reasons individuals choose to opt out of promotional credit offers is to prevent collection agencies (CA) and junk debt buyers (JDB) access to your information.
These organizations specialize in buying unpaid debts in an attempt to recuperate the funds from the debtor. If you have always paid off all of your debts, this shouldn’t be an issue.
But if you have ever had any debt that you did not paid in full, you may want to consider opting out. This may include an account that went to collections for nonpayment, or perhaps it a small utility bill that was neglected.
Sometimes CAs and JDBs will observe and look for indications that you have the ability to repay previous debts.
There is evidence that they will use promotional lists to observe when people are rebuilding their credit or shopping for a mortgage loan.
This provides a good indication that you’re more likely to repay, and therefore could entice these organizations into requesting payment of debts you thought were long forgotten.
If you are asked to repay old debts, protect yourself by following these steps:
- Request they validate all information related to the debt
- Check to see if the applicable statute of limitations has passed
- Avoid making any promises you don’t want to keep
How to opt out of promotional credit offers
Opting out of promotional credit offers can be done over the phone, online, or through a mail-in form. You can opt out for five years over the phone or online, but to permanently opt out, you need to physically mail in a signed form.
If you change your mind, you can also opt back into credit offers through these same methods.
Five year opt out
To place a promotional suppression on your credit account for five years, call 1-888-5-OPTOUT (1-888-567-8688) or visit OptOutPrescreen.com.
Both options provide official methods to opt out from the major consumer credit bureaus, including Experian, Equifax, TransUnion, and Innovis.
You must provide your name, address and optionally your Social Security Number and date of birth. This will ensure that the credit bureaus will have the information required to successfully process your request.
Permanent opt out
To request a permanent opt out of promotional credit offers, call 1-888-567-8688 or visit OptOutPrescreen.com to start the process. You will then need to either request for a permanent opt out form over the phone or print one from the website.
Once you have the physical form, fill it out and mail it. This confirms your permanent opt out which will keep you off the prescreened lists indefinitely.
Opting out for minor children
Credit bureaus do not typically keep files on children, however there are instances where this has happened as a result of fraud through identity theft.
If you suspect this to be the case, you can opt out on behalf of your child through a written request.
Send a letter that identifies your child as well as a requests the opt out to the four credit bureaus that sell promotional lists:
- Experian P.O. Box 9532 Allen, TX 75013
- TransUnion P.O. Box 505 Woodlyn, PA 19094-0505
- Equifax, Inc. P.O. Box 740256 Atlanta, GA 30374
- Innovis Consumer Assistance P.O. Box 495 Pittsburgh, PA 15230-0495
If you suspect identity theft, you should also:
- Have the bureaus freeze their credit
- Place a fraud alert on their files.
- Get an FTC Theft Affidavit from www.identitytheft.gov
- Contact any involved creditors or lenders
- File a police report.
Other opt out processes
The credit bureaus are not the only ones selling lists for promotional sales. It’s nearly impossible to keep your name off of every list, however you can precautionary steps to reduce your chances through these methods:
- Add your number to the “Do Not Call Registry” by visiting donotcall.gov. It is a free service.
- Opt out of the Direct Marketing Association (DMA) promotional network by creating an account on DMAchoice.org and then explicitly opting out. You can also mail in a form. A 10-year opt out costs $4 online or $5 mail-in.
- Hire companies like catalogchoice.com or paperkarma.com to help you control junk mail.
Reach out directly to the companies sending you unwanted mail, including high-volume mailers like save.com, valpak.com, and mspark.com, as well as specific retailers.