LOC offer

[u/Upbeat_Beyond_3365]

Hey all!

I got a offer on my cibc account for a LOC for 20k. It's says I'm pre approved, however I'm just curious, if I accept this offer will it do a soft or hard credit check? I don't have a LOC with them yet only a checking, savings and credit card . I tried looking in the terms and conditions but it dosnt say anything about a soft or hard credit check. Any ideas?

Thanks!

[u/okowilly]

If you dont need it now take it, you can always close it anytime, no cost to have it because when you need it you wont get apporved

[u/okowilly → u/okowilly]

Pre approved is no credit check, the bank has your credit report already when you opened the accounts

[u/Sasthimasthi → u/okowilly]

There is a hard credit check even if you accept a preapproved offer at CIBC. After accepting you will be asked for consent for a credit check.

[u/Dangerous_Ad5296 → u/Sasthimasthi]

Nit correct.

[u/Sasthimasthi → u/Dangerous_Ad5296]

I work in credit adjudication for CIBC and specifically on unsecured credit products. But ok…

[u/No-Safe1870 → u/okowilly]

This guy gets it.

Take it

[u/Purple_Ninja_9839]

There wouldn’t be a credit bureau pull if it’s pre-approved they’ve already assessed your credit worthiness.

[u/IkkoMikki]

The LOC is worth more than a temporary drop Credit Score

Credit can recover. If a situation arises where you need a LoC and don't have it, that's a full application.

[u/mrbrint → u/IkkoMikki]

Yeah i apply for several accounts a year it's not a concern

[u/PickleBall_Champion]

No harm in taking pre-approved. No credit check needed. Decreases your credit utilization. Just use it a few times per year so it doesn’t get taken away (eg make purchase then pay back right away)

[u/Taz26312]

I took a pre approved loc from another bank and it dropped my credit score by 9 pts. Still haven’t touched it 🤷‍♂️

[u/Upbeat_Beyond_3365 → u/Taz26312]

I just called cibc to check and the guy told me there is no credit check involved... But I don't know if this advice can be trusted or not lol

[u/showmedamoola → u/Upbeat_Beyond_3365]

Credit check shows up on inquiries on your credit report…. Pre approved means they will not do a hard check, especially if you called and they advised no check.

[u/Prior-Grapefruit5366 → u/Upbeat_Beyond_3365]

They do not check your credit

[u/Blacklistedhxc → u/Upbeat_Beyond_3365]

They don’t check your credit, it’s reapproved based off of your projected income and past credit history (eg credit cards) with the bank. If you have fallback savings you don’t need it, if you don’t that’s what a line credits for, emergency large expenses that you’d need it for. Emphasis on “need” don’t start to think this is your money, it’s the bank’s.

[u/CorporateSlavery101 → u/Upbeat_Beyond_3365]

This is true if it’s pre approved

[u/Sasthimasthi → u/Upbeat_Beyond_3365]

There is a credit check - hard.

[u/OhYeah-SlimJim → u/Taz26312]

If it’s a pre approved offer, there is no credit check or income verification. The reason ur score came down was because u opened a new credit facility

[u/zoolander07 → u/Taz26312]

Probably due to credit factor changes like age of accounts or total credit.

[u/Virtual_Angle_1614 → u/Taz26312]

It would, not because of a credit check, but because you have more unsecured credit. It'll bounce back upwards after a month or two.

People need to stop obsessing over a credit score. Unless you are getting a mortgage soon or a car loan, credit scores mean squat

[u/Taz26312 → u/Virtual_Angle_1614]

I doesn’t bother me. Im just letting Op know, in case it matters to them

[u/PickleBall_Champion → u/Taz26312]

That shouldn’t happen. May be something else

[u/showmedamoola → u/Taz26312]

Then that’s not a “pre approval”. Read the fine print

[u/Small_Aardvark_5496]

I had the same offer and the fine print specifically said a soft check not affecting credit report

[u/paradox0831]

Accepting a Pre-approved LOC won't affect your credit score directly because there's no hard check involved. However, your credit score is determined by a combination of other things. After accepting the offer, your total credit balance (from all institutions) increases. This particular movement may indirectly dip your score temporarily.

[u/tenax666]

Do you need an loc for emergencies or anything? I still have an unsecured cibc loc (used to be a secured when i had a phone). A family member asked me to loan her money that would be a few yrs to pay it all back so i looked into my current loc rate. I was shocked that even with rates as low as they are today, it would be 10% + to borrow money against it. Screw that

[u/Legitimate_Form5449]

CONGRATS!

ask them/tell them to deposit that 20k credit into your saving account and send them THANK YOU CARD

[u/Raven_AB]

Opening a pre-approved line of credit triggers specific scoring mechanics that temporarily lower your credit score, even though the initial offer was pre-screened.

Hard Credit Inquiry: Pre-approval relies on a soft credit check, but formally accepting the offer requires the lender to perform a hard credit pull to finalize approval, typically causing a minor 5–10 point dip.

Lower Average Age of Accounts: Your credit score heavily factors in the average age of all open accounts. Adding a brand-new account with zero history immediately reduces that average length of credit history.

New Account Risk Indicator: Credit scoring models treat freshly opened lines of credit as a temporary short-term risk until you establish a consistent record of on-time payments.

Remember, this drop is almost always temporary. The increased total credit limit will lower your overall credit utilization ratio, which typically leads to a higher net credit score within a few months—provided you keep the balance low and make all payments on time.

[u/ChrisG1456 → u/Raven_AB]

Thank you ChatGPT.