Pre-qualification Definition

Pre-qualification is used by many borrowers-usually credit card companies-to scan tens of thousands of potential borrowers in order to select the best candidates to receive loan offers. In the pre-qualification process, the credit histories of many individuals are rapidly scanned and a potential borrowing range is established. Customized communications-bulk mailings-are then sent out advertising credit tailored to the recipient. Pre-qualification is not pre-approval and does not guarantee an actual loan will be offered.