UPDATE: Aro no longer uses pre-approval but may give you an indication of your chance of acceptance with a lender when you check your eligibility. Please bear in mind that any pre-approved finance option or chance of acceptance indication will be subject to final lender checks and it does not guarantee acceptance. If you proceed with a lender, the lender may carry out a hard credit search to complete their final checks.
When you’re hunting for a loan, it can be easy to get bogged down in a whole lot of finance jargon. To give you a better idea of exactly what you’re looking at in your search results, we’re going to breakdown one of the most commonly asked questions: ‘what is a pre-approved loan offer?’ From how it works to its handy benefits, here’s why you should keep an eye out for them when applying for finance.
What is a pre-approved loan offer?
If you’ve checked your loan offers with us recently, you might have noticed some offers are ‘100% pre-approved’. This means that, based on the information you’ve given us, the lender has pre-approved you for that loan offer based on a soft search (the kind that doesn’t leave a mark on your credit file).
Not sure what we mean by soft search? Check out our guide, What’s a soft search?
This means that if all the information in your application is correct, subject to final fraud and lender checks, you can proceed with that loan offer confident that it is unlikely you’ll be declined at a later stage.
How is this different from a traditional loan offer?
When you shop around for finance, the loan offers provided will be dependent on the lender running a hard search on your credit file to do their final checks. Although this is often still the case, pre-approval ratings let you know how likely you are to be approved before you commit to a hard search on your credit file.
Instead of you simply having to apply blind, we now add pre-approval ratings to our loan search results to help you decide whether to proceed with an offer.
How do pre-approved loan offers benefit me?
We know no one likes having their time wasted. Pre-approval ratings can make the loan application process quicker and easier from start to finish.
- Protect your credit score: you have the option to choose an offer that’s more likely to help you maintain a healthy credit score.
- Speedier process: avoid wasting time on loan offers with a higher chance of rejection.
- Proceed with confidence: you can proceed with your chosen lender with less worry of being rejected at a later stage.
Ultimately, choosing a loan offer comes down to picking the one that’s right for you. If you’re not sure where to start, take a look at our guide to comparing loan offers.
Want to take a look at your latest options? Check if you have any loan offers now without harming your credit score.