Is it Legal for Information on my Credit File to Be Used for Advertising?

Actually, yes. You may be surprised to learn that any business with a “permissible purpose” can gain access to your credit report, including anyone who wants to be in business with you. “Permissable purposes” include creditors and companies who pull your credit scores for “promotional purposes” – that is, they want to see if they should market their services to you. This is perfectly legal and admissible. These inquiries then become part of your credit report – but they are called “soft inquiries.” “Hard inquiries” are inquiries that come from a lender who is inquiring for the specific purpose of extending you credit. Numerous hard inquiries can have a negative impact on your score, but soft inquiries have no impact whatsoever.

Whenever you receive a “preapproved” or “prescreened” offer of credit, this is because the bank or company who is offering credit to you has either pulled your credit information through a “soft inquiry,” or the credit bureau has sold your information as part of a “trigger lead” program. “Trigger leads” happen when you authorize a lender to access your credit report in reference to a loan application, or other type of credit application. If you meet certain searchable criteria that lenders are looking for (such as age, state of residence, annual income, and credit score), the credit bureau may send your name, address and telephone number to lenders who are part of the trigger lead program, in order for them to solicit your business.

You can choose to opt out of receiving this sort of targeted advertising by going to www.optoutprescreen.com. While this method will not eliminate all targeted advertising, it should eliminate a lot of preapproved offers for five years. For more information, you can consult the Fair Credit Reporting Act (FCRA), which is a federal law that restricts who has access to the information in your credit report.