Audi FS denial letter after said I was approved?!!

[Anonymous]

Hello everyone,
So back in June I went over to my local Audi dealer, thought of leasing an Audi A4. So I filled out the app, they pulled my credit, said it was 705 by TU. I have a current auto lease (about 8 months)...and credit cards ($5750 limit, $1250, $1000, $300....utilization 3%, almost no debt, excellent DTI). Total credit age ~1.5 years, my age is 20. In 2 hours I receive a call from the sales consultant saying I am all good, just show proof of income and pick up the car. After thinking over, I realized I don't want that car, so I decided to keep my car. Was curious honestly to see if I can get approved.
I called in and said I changed my mind, no thanks.

Today I receive letter from VW Credit stating that my credit score is 714, and I was denied due to bla bla bla...high loan to value, many inquiries, credit age/length, and other stuff.

What does this even mean? Really curious.

[Brian_Earl_Spilner]

Are you sure they approved you with vw? They may have shopped you around. Whats your credit reports say?

[Anonymous]

We were working on a lease. Only the dealer and VW Credit are on my inquires. I even asked the guy If I was approved, and he said yes, but I didn't bring in POI since I decided not to proceed with car. I even asked If I need a co-signer, and they said just letter from job or pay stubs, and I can pick up the car.

[Brian_Earl_Spilner]

Sorry, missed that part. That's definitely weird then.

[Anonymous]

That is why I posted question here. Really weird lol. Didn't see any reasons to be declined. Have a auto lease right now, excellent utilization, very low DTI. Should have not even been an issue with approval. Don't know who is the liar

[Loquat]

As a previous Finance Manager I'm going to take an educated guess at what may have happened...

The F&I guy probably loaded the deal...the system probably automatically turned you down.  When this happens, by law, they have to mail or provide you with a reason as to why your credit was denied.

But the manager said you were approved...well here's how that happens.  As I previously mentioned...your app was probably automatically turned down.  The Finance Manager may have called in an spoken to his rep/underwriter about your app and got them to manually overturn thus providing you with an approval.  

If this is the likely scenario, you now have some clarity as to why you received the notice in the mail.  Deal loaded...auto turned down, denial of credit letter generated the moment you're turned down.  Finance Manager calls after the fact, gets a denial overturned, thus you having an approved deal.  It happens ALL the time in the industry.  There are times when my customers would receive several letters of such from lenders, often times from the very same lender that I eventually hung them with.  

But going forward, just know that any time the system automatically denies you credit, you're going to get a letter explaining such.  It doesn't matter if the Finance Manager had the deal overturned 10 seconds later...the fact of the matter is that the system initially turned you down and by law that letter has to be generated.  

So don't sweat it, I'm pretty sure if the F&I guy said you were approved, he got you done.  Disregard the letter...it's just formality.  

[Anonymous]

Hi! Thank you for the great explanation. I think it is exactly the case. I was surprised that I didn't get that insant approval. Guess because of me being 20, and having short history. Still, feels pretty cool to get approved for a 50k car haha, without money down or cosigner.

[Anonymous]

Age is a protected class..your age doesn't matter...your age of your credit, downpayment, resources, etc matters...but not your age...that's why a 95 year old person can get a 30 year mortgage or a 5 year auto loan...

[Anonymous]

Have to agree! That is why I really wanted to test it. After reading tens of posts where it says at age 19-21 you will never be approved without cosigner, I said well let me try it. So I did...and I would have been able to take the new car home, if I came into finance with proof of income (I did put my real income on app). I know this other guy who bought a 40k car at 22 with 0 down, having 741 credit!

[Anonymous]

If they do not book the loan or lease with the lender, they will send you a decline. It’s an industry standard. Sometimes if a dealer submits you and you are declined at first and they call in a favor and get you approved, you will get a decline letter before your first payment , and then get your welcome to XYZ Financial services a couple weeks later. It always confuses consumers