So when is a Firm offer of Credit NOT so firm?

Potential credit grantors get to take a sneak peek at your credit report if they have certain criteria and are ready to make you a “firm offer of credit” under the Fair Credit Reporting Act (“FCRA”). So when you get a “You’ve been pre-approved for a Visa credit card” letters in the mail, is it really a simply matter for you to sign your name and get your credit card in the mail the next week? No….it really isn’t.
Judge Patrick Duggan in Wilson v First Bank of Delaware, Case No. 10-11345, (Eastern District of Michigan), was recently presented with this very issue. First Bank of Delaware (FBD), approached Trans Union with a list of criteria for people to whom it wanted to give a credit card. Mr. Wilson’s credit report was given to Trans Union based on that criteria. Wilson received such a pre approval letter in the mail from FBD. However, FBD pulled Wilson’s credit report again and changed its mind and declined to give Wilson a credit card. Wilson sued under the FCRA, claiming that FDB improperly pulled his credit report because it did not extend a firm offer of credit to him. The court sided with FBD.
The court looked at the FCRA and determined that FBD had complied with the statute by approaching Trans Union with a list of criteria so that it could extend firm offers of credit to people meeting that criteria. But, the FCRA does not hold a potential lender hostage by requiring them to actually commit to making a loan to these people. The potential lender can still review a person’s credit report again and look at the credit application before making a decision. In this case, the subsequent Trans Union report on Wilson showed a charge off which make his credit report inconsistent with the criteria that FBD had been looking for in connection with its prospecting program.


Moral of the story to consumers – Don’t incur debt in anticipation that your signature is going to be the only thing that the bank needs to send you a credit card. Those pre-approval letters that you get in the mail that lead you to believe that if you “sign here and the card is yours” is not necessarily true. The potential lender has the right to reexamine your credit to determine whether you meet the criteria for “firm offer of credit.” Be careful.

If you have been harassed or bullied by a debt collector, or if your credit report is inaccurate and the credit reporting agency will not fix it, email Attorney Gary Nitzkin or call toll free (888) 293-2882. For more information about our firm, visit our website, Michigan Consumer Credit Lawyers. We have a lot of good information including short “how to” videos that you will find useful.

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