topic Re: Paid Cash for Car- They pulled credit in Auto Loans

Paid Cash for Car- They pulled credit

CaroleBaskinBB — Fri, 28 Apr 2023 02:35:08 GMT

My husband and I purchased a car in cash this evening and we paid via personal check. I checked ahead of time that they accepted this and didn't require a cashiers check.

I was surprised that after we got there they said they needed to check credit to make sure we are who we say we are because we were paying with a personal check. I asked if this was a hard inquiry and they insisted it would not be.

Lo and behold I get a monitoring alert a couple hours later saying that they pulled credit. It appears to be a hard inquiry. If it is, I am absolutely livid. Does anyone know if this is standard practice when purchasing with a personal check?

Re: Paid Cash for Car- They pulled credit

Brian_Earl_Spilner — Fri, 28 Apr 2023 02:38:36 GMT

They don't need to pull your credit to verify your identity, but it's a pretty standard excuse to pull your credit.

Re: Paid Cash for Car- They pulled credit

Creditwiser — Fri, 28 Apr 2023 02:44:32 GMT

@CaroleBaskinBB wrote:
My husband and I purchased a car in cash this evening and we paid via personal check. I checked ahead of time that they accepted this and didn't require a cashiers check.

I was surprised that after we got there they said they needed to check credit to make sure we are who we say we are because we were paying with a personal check. I asked if this was a hard inquiry and they insisted it would not be.

Lo and behold I get a monitoring alert a couple hours later saying that they pulled credit. It appears to be a hard inquiry. If it is, I am absolutely livid. Does anyone know if this is standard practice when purchasing with a personal check?

I would be steaming mad too. It seems to me you're drivers license should have sufficed and if that wasnt good enough, a soft pull should have. I had my credit pulled years ago while on a test drive as they required a copy of my license. From then on whenever I test drive I request the sales persons manager and tell them point blank...." Dont even think about pulling my credit as I'm not authorizing it "

Sorry to hear this and I hope it was an SP for you. They did tell you upfront though , but I would go back there and give them a hard time about it if in fact its a HP.

Re: Paid Cash for Car- They pulled credit

JoeRockhead — Fri, 28 Apr 2023 11:43:33 GMT

Since you weren't applying for credit, the dealership didn't need to access your credit score and report. And in fact, the FCRA limits access to your credit information in these types of situations. According to the FCRA, credit reporting agencies may only provide information about you to people who are applying for credit in some way such as a loan, Credit cards or other situations such as employment. To verify your ID for writing a check? Never heard of this.

A dealership might also falsely cite the Patriot Act as a reason to run your credit report. But federal anti-money-laundering regulations do not require a dealership to pull your credit on a cash transaction.

There are a multitude of ways they could have further verified your identity and/or banking history. Don't blame you for being upset about it.

But, congratulations on your new car!

Re: Paid Cash for Car- They pulled credit

fury1995 — Fri, 28 Apr 2023 12:33:32 GMT

Unfortunately, whatever dealership personnel said to you is irrelevant. If you signed a document that stated permission for credit inquiry, you gave permission and the dealership has that. As @Brian_Earl_Spilner said, it is standard practice for dealerships to use this method when a purchaser is using unverified funds. Equifax, for example is a provider of Red Flags verification.

@JoeRockhead mentioned Patriot Act however all Car Dealerships are governed by the same regulations as any lending institution; Bank Secrecy Act, USA PATRIOT Act, AMLA, OFAC, and Anti-money Laundering / Anti-terrorism Regulations) and are audited for compliance. Most dealers will point to OFAC when requesting identity information when conducting a transaction however your social security number is not required for OFAC. OFAC, specifically is MANDATORY for any transaction, cash or credit.

The dealership should have suggested two options, take your personal check and wait for funds to clear then release your new vehicle to you or...as you suggested, a certified/cashiers check. Dealer personnel were absolutely incorrect for telling you verbally the inquiry would be a soft inquiry. I've never known of a dealer having this capability.

@JoeRockhead a "person" presented a driver's license (real ID) and a passport yesterday morning to me to purchase and finance a $60k vehicle. Both ID's looked incredibly legitimate, independently. This "person" had all information necessary. I asked for a second ID to process the transaction and that's when I caught the forgery. I spoke to the REAL owner of the identity after a couple hours of background searches (and discovered his brother is Homeland Security). I had the misfortune of telling him of his dangerous situation without alerting the fraudster. I see these attempts happen personally a couple times a month. ID'S, bank statements, utility bills, paychecks. Don't underestimate the capability of a identity thief or hinder the people who are responsible for protecting their victims. So no way I'd just accept an ID and consider that enough and I don't know if you'd want me to.

Re: Paid Cash for Car- They pulled credit

OmarR — Fri, 28 Apr 2023 14:12:52 GMT

@fury1995 you seem to be in the business, so I am curious;

If OP had signed a bunch of paperwork with credit check permission on Page 99, and her reports were frozen, I am assuming that the HP would NOT have gone thru?

Re: Paid Cash for Car- They pulled credit

Brian_Earl_Spilner — Fri, 28 Apr 2023 17:02:12 GMT

@OmarR wrote:
@fury1995 you seem to be in the business, so I am curious;

If OP had signed a bunch of paperwork with credit check permission on Page 99, and her reports were frozen, I am assuming that the HP would NOT have gone thru?

It wouldn't have gone through, but the purchase would stop while they ask you to thaw your reports. This brings up a double edged sword. Thawing is, for the most part, instant. But, I've had TU take a week to thaw before. Totally screwed up my chances to make a purchase at the sale price.

Re: Paid Cash for Car- They pulled credit

OmarR — Fri, 28 Apr 2023 22:28:31 GMT

@Brian_Earl_Spilner wrote:
@OmarR wrote:
@fury1995 you seem to be in the business, so I am curious;

If OP had signed a bunch of paperwork with credit check permission on Page 99, and her reports were frozen, I am assuming that the HP would NOT have gone thru?
It wouldn't have gone through, but the purchase would stop while they ask you to thaw your reports. This brings up a double edged sword. Thawing is, for the most part, instant. But, I've had TU take a week to thaw before. Totally screwed up my chances to make a purchase at the sale price.

That's what I figured.

That's the part where I have ZERO problems waiting for my check to clear, or simply walking away and going somewhere else.

Re: Paid Cash for Car- They pulled credit

Creditwiser — Fri, 28 Apr 2023 22:39:18 GMT

@fury1995 wrote:

Dealer personnel were absolutely incorrect for telling you verbally the inquiry would be a soft inquiry. I've never known of a dealer having this capability.

@JoeRockhead a "person" presented a driver's license (real ID) and a passport yesterday morning to me to purchase and finance a $60k vehicle. Both ID's looked incredibly legitimate, independently. This "person" had all information necessary. I asked for a second ID to process the transaction and that's when I caught the forgery. I spoke to the REAL owner of the identity after a couple hours of background searches (and discovered his brother is Homeland Security). I had the misfortune of telling him of his dangerous situation without alerting the fraudster. I see these attempts happen personally a couple times a month. ID'S, bank statements, utility bills, paychecks. Don't underestimate the capability of a identity thief or hinder the people who are responsible for protecting their victims. So no way I'd just accept an ID and consider that enough and I don't know if you'd want me to.

I have had dealerships do SP's subsequent to my outlandish HP for a test drive. You may not be aware of it but perhaps its a state to state thing. The OP was not financing so in that scenario, I get the need to take the steps to verify. But as mentioned, definitely pay attention to what you're signing.

Re: Paid Cash for Car- They pulled credit

fury1995 — Fri, 28 Apr 2023 23:22:49 GMT

@OmarR wrote:
@Brian_Earl_Spilner wrote:
@OmarR wrote:
@fury1995 you seem to be in the business, so I am curious;

If OP had signed a bunch of paperwork with credit check permission on Page 99, and her reports were frozen, I am assuming that the HP would NOT have gone thru?
It wouldn't have gone through, but the purchase would stop while they ask you to thaw your reports. This brings up a double edged sword. Thawing is, for the most part, instant. But, I've had TU take a week to thaw before. Totally screwed up my chances to make a purchase at the sale price.

That's what I figured.

That's the part where I have ZERO problems waiting for my check to clear, or simply walking away and going somewhere else.

@OmarR Yep, that's also what identidy theives do when we put them through this process.

They threaten to take their "business" somewhere more willing... and fortunately they often find one.

And yes, I'm in the auto dealer busniess. I get fraud attempts more than once a month.

Re: Paid Cash for Car- They pulled credit

OmarR — Sat, 29 Apr 2023 00:15:57 GMT

@fury1995 wrote:
@OmarR wrote:
@Brian_Earl_Spilner wrote:
@OmarR wrote:
@fury1995 you seem to be in the business, so I am curious;

If OP had signed a bunch of paperwork with credit check permission on Page 99, and her reports were frozen, I am assuming that the HP would NOT have gone thru?
It wouldn't have gone through, but the purchase would stop while they ask you to thaw your reports. This brings up a double edged sword. Thawing is, for the most part, instant. But, I've had TU take a week to thaw before. Totally screwed up my chances to make a purchase at the sale price.

That's what I figured.

That's the part where I have ZERO problems waiting for my check to clear, or simply walking away and going somewhere else.
@OmarR Yep, that's also what identidy theives do when we put them through this process.

They threaten to take their "business" somewhere more willing... and fortunately they often find one.

And yes, I'm in the auto dealer busniess. I get fraud attempts more than once a month.

I can totally understand the fraud aspect from your point of view. But if i am a cash customer refusing a HP, do you or other dealers offer alternative methods? Like a wire transfer, cashiers check, etc?

Currently, I'm someone who drives beaters that I pay cash for. My mortgage is my only debt. After that is done (hopefully) soon, I just don't see myself ever going into debt again. I never buy new, so even dealer incentives do nothing for me.

Just curious.

Re: Paid Cash for Car- They pulled credit

OmarR — Sat, 29 Apr 2023 00:26:46 GMT

@fury1995

Also, if a fraudster has all the convincing info, I.D., etc, does a HP really hang him/her up? Like you now have the phone number associated with the credit report, and you call it, and the real identity is at home watching Yellowstone?

Honestly asking.

Re: Paid Cash for Car- They pulled credit

fury1995 — Sun, 30 Apr 2023 03:46:23 GMT

@OmarR wrote:
@fury1995

Also, if a fraudster has all the convincing info, I.D., etc, does a HP really hang him/her up? Like you now have the phone number associated with the credit report, and you call it, and the real identity is at home watching Yellowstone?

Honestly asking.

@OmarR Yeah, pretty much. The assumption is the application legitimate. When I move on to the actual transaction, that's when everything is scrutinized. The phone number on the application is the crook. People don't generally have their phone numbers on their actual bureau unless their is an existing fraud alert in which case it wouldn't matter.

Re: Paid Cash for Car- They pulled credit

MountainHiker — Mon, 01 May 2023 20:15:01 GMT

@CaroleBaskinBB wrote:
My husband and I purchased a car in cash this evening and we paid via personal check. I checked ahead of time that they accepted this and didn't require a cashiers check.

I was surprised that after we got there they said they needed to check credit to make sure we are who we say we are because we were paying with a personal check. I asked if this was a hard inquiry and they insisted it would not be.

Lo and behold I get a monitoring alert a couple hours later saying that they pulled credit. It appears to be a hard inquiry. If it is, I am absolutely livid. Does anyone know if this is standard practice when purchasing with a personal check?

Very sorry to hear your confidence was misused. I would demand they remove that hard inquiry from your credit report. And if they don't then call up the credit bureaus yourself and dispute them. Equifax will probably be the most difficult to dispute on your own based on personal experience, but I have found Transunion and Experian to be far more customer service friendly. Imo promising one thing while doing another is fraud. Bait and switch is very prevalent in the corporate world. Good luck moving forward.

Re: Paid Cash for Car- They pulled credit

cashorcharge — Tue, 02 May 2023 02:17:11 GMT

Even though you paid with a check, there isn't really anything from prohibiting you from stopping payment on the check that same day so the dealership ran your credit likely as a way to say...if this check bounces, we are going to send this contract to X bank and with your credit report in hand, they are guaranteeing they can get your loan approved. It's unfortunate that the explanation you were given was incorrect.

As far as getting it removed, I wish you luck but don't have the highest hopes unfortunately

Re: Paid Cash for Car- They pulled credit

fury1995 — Wed, 03 May 2023 00:01:39 GMT

@MountainHiker wrote:
@CaroleBaskinBB wrote:
My husband and I purchased a car in cash this evening and we paid via personal check. I checked ahead of time that they accepted this and didn't require a cashiers check.

I was surprised that after we got there they said they needed to check credit to make sure we are who we say we are because we were paying with a personal check. I asked if this was a hard inquiry and they insisted it would not be.

Lo and behold I get a monitoring alert a couple hours later saying that they pulled credit. It appears to be a hard inquiry. If it is, I am absolutely livid. Does anyone know if this is standard practice when purchasing with a personal check?
Very sorry to hear your confidence was misused. I would demand they remove that hard inquiry from your credit report. And if they don't then call up the credit bureaus yourself and dispute them. Equifax will probably be the most difficult to dispute on your own based on personal experience, but I have found Transunion and Experian to be far more customer service friendly. Imo promising one thing while doing another is fraud. Bait and switch is very prevalent in the corporate world. Good luck moving forward.

The dealer likely covered their bases with a signed document allowing the inquiry. That's likely how the conversation of the type of inquiry occurred. What was actually signed is the only thing that matters legally..

Re: Paid Cash for Car- They pulled credit

MountainHiker — Wed, 03 May 2023 10:11:13 GMT

@fury1995 wrote:
@MountainHiker wrote:
@CaroleBaskinBB wrote:
My husband and I purchased a car in cash this evening and we paid via personal check. I checked ahead of time that they accepted this and didn't require a cashiers check.

I was surprised that after we got there they said they needed to check credit to make sure we are who we say we are because we were paying with a personal check. I asked if this was a hard inquiry and they insisted it would not be.

Lo and behold I get a monitoring alert a couple hours later saying that they pulled credit. It appears to be a hard inquiry. If it is, I am absolutely livid. Does anyone know if this is standard practice when purchasing with a personal check?
Very sorry to hear your confidence was misused. I would demand they remove that hard inquiry from your credit report. And if they don't then call up the credit bureaus yourself and dispute them. Equifax will probably be the most difficult to dispute on your own based on personal experience, but I have found Transunion and Experian to be far more customer service friendly. Imo promising one thing while doing another is fraud. Bait and switch is very prevalent in the corporate world. Good luck moving forward.
The dealer likely covered their bases with a signed document allowing the inquiry. That's likely how the conversation of the type of inquiry occurred. What was actually signed is the only thing that matters legally..

I wouldn't be a bit surprised it that company lied to their faces. The right thing to do would be giving the client all information upfront. And especially considering that the OP did in fact expressly asked if there would be a hard inquiry involved in the purchasing process. And when that company verbally committed to not performing a hard inquiry and then breached that agreement, in my mind it became a legal matter. It's not proper contract law to verbally commit an agreement that counters the written contract. For that reason alone I would fight it.

Re: Paid Cash for Car- They pulled credit

sccredit — Wed, 03 May 2023 19:44:01 GMT

When we bought a car for our kid we were paying in full. We were told if we wrote a personal check they'd pull credit but if we paid by credit/debit card or physical cash they could run OFAC only.

Re: Paid Cash for Car- They pulled credit

CreditCuriosity — Thu, 04 May 2023 02:32:45 GMT

OFAC is likely the reasons as eluded to by @fury1995 . I use to work for a company that provided extended service contracts to cars sold through most dealerships and I wrote the program that did OFAC checks of a person as any financial transaction that we did had to do this to comply to the law. Granted we didn't need to pull a persons credit we used other PII (Personal identifying information) to run through the OFAC DB to see if a hit happened or not and if so reported accordingly.

Re: Paid Cash for Car- They pulled credit

docbang — Mon, 08 May 2023 22:27:15 GMT

@cashorcharge wrote:
Even though you paid with a check, there isn't really anything from prohibiting you from stopping payment on the check that same day so the dealership ran your credit likely as a way to say...if this check bounces, we are going to send this contract to X bank and with your credit report in hand, they are guaranteeing they can get your loan approved. It's unfortunate that the explanation you were given was incorrect.

As far as getting it removed, I wish you luck but don't have the highest hopes unfortunately

Correct! The dealer needs a "CASHABLE DEAL" even if the dealer check all the licenses,, birth certificate, insurance info, etc and they all checked out. All the dealer care about is the assurance that they will get their money (funding) by selling the contract to the any financial institution if you decide to flip flop on them. As for the HP, it's done. Personal check is a UNVERIFIED FUND..