Score hit hard for "one" auto loan application

Anonymous · ‎03-29-2011

I was shopping around online for a used car and found a candidate in a city (Houston, TX) 200 miles from home. So I asked that they hold it for me until the next day so I could get out there. They said they would but only if I applied for their financing, just to see if I would be qualified, and I had no obligation to use their financing. So I though, why not. Ok, I get pre-approved at their lowest rate since my score was above 800. Not a real surprise since I'm very careful with my credit.

Now the bad news. My score 2 weeks later is now 749!. The ONLY change that I can see is the fact that when they ran my application they ran it through 4 different providers!! So guess what that looks like on my credit profile? Four separate credit applications. Is this even legal?

CreditBob · ‎03-29-2011

Multiple inquires within a 2 week period for only auto or mortgage loans count as one inquiry. However, the fico score does not count the first month on a few inquires that are in relation to auto and mortgage loans. Has anything else on your report changed such as having a balance increase on revolving accounts or have any been paid off in full? Revolving accounts with a small balance will have a more favorable impact than if they are paid in full & reflect a zero balance. I know this from experience. So try to think of anything else that you may have done.

llecs · ‎03-29-2011

To add, it isn't uncommon for a car lender to use a non-Classic FICO score, but rather an auto-enhanced FICO score. It wouldn't be uncommon to see a difference between the score the lender used and the score pulled from here. That does bring the question, though: Did you pull the 749 from here?

smallfry · ‎03-30-2011

That would be my first thought. Maybe 20 points or so in an extreme case but 50 points is not possible. My oldest lost 20 points for 2 inquiries and a new account reporting with a significant loss of average age. 50 points for even 4 separate/different credit application inqs is not possible.

JayRizzo · ‎03-30-2011

I've never been a fan of FICO, FAKO, or enhanced scoring, etc because they're all full of anomalies that no one can explain THEN you have lots of finger-pointing every which way BUT at FICO -- I get so sick and tired of it. Face the fact that it's not working as it should.

Many of us are seasoned enough to have our reports and scores in-check before we make a major purchase like a house or car. Then when the score sinks faster and deeper than the Titanic, everyone ask... did you pull it from FICO? Did another balance increase? Did this? Did that? Nooooo. Ergo, "prepared" for the purchase by having the report and score in-check, again.

I've seen too many cases where people have paid a balance with the expectation of seeing a score increase while it drops 40-50 points, then the FICO excuses begin.

I've seen too many cases, including this one, where people shopped for an auto WITHIN the given timeframe just to be disappointed by this scoring system.

Come off of it, REALLY, we all know it doesn't work like we think! I just get tired of the same excuses and finger-pointing away from FICO like it had nothing to do with it.

My 15 cents worth (inflated from 2-cents due to my frustration).

llecs · ‎03-30-2011

@JayRizzo wrote:
I've seen too many cases, including this one, where people shopped for an auto WITHIN the given timeframe just to be disappointed by this scoring system.

Unless OP posted 2 scores from two different scoring systems...the odds of that lender pulling a Classic FICO are real slim.

Anonymous · ‎03-30-2011

Wow thanks for all the great info. First I have two scores from here, 801 and 811. I was mistaken about the time line a bit. I originally stated that it was two weeks before the drop. (Which was the time frame I found it in.) But the actual scores were pulled 1 month before. So it was more like 4-5 weeks the scores went from 800's to 750. Sorry for the mis-info.

That said though, I can't see/remember anything that changed other than the inquiries. That's not to say there isn't anything, I just can't see it. As for which score(s) the auto dealer uses, I have no idea.

Thanks again for all the input!