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Car dealerships make me want to light myself on fire. Here's what happened:
My oldest daughter turned 18 recently, and my wife and I decided to buy her a car. I got a pre-approval from CapOne, found a vehicle on their website and built an offer that included what I expected to be the correct fees and cost for a warranty. After test driving the vehicle, we decided to move forward with the purchase so that's when I pulled out the pre-approval printout and started filling out forms. I specifically told the dealership that I had a pre-approval from CapOne, and that because I am monitoring my credit very closely I want to use CapOne and DID NOT want to be submitted to any other banks without them discussing the bank and requested terms with me first and getting my explicit approval to submit. Fifteen minutes later, all is well and we are moving to the finance department to sign documents based on the terms agreed to by CapOne.
I woke up the next morning to multiple alerts indicating that my application had been submitted to several banks, specifically against my directions, including a bank that I had a prior default with that I NEVER would have authorized since I know it would not have been approved.
I have contacted the dealership several times and they do not appear to be interested in working with me to resolve this, so now I am stuck with a bunch of additional inquiries that I did not authorize.
I am considering disputing them as I feel that may be my only course of action at this point, but before I do that I wanted to ask for recommendations and see what others think.
Thanks!
That is common practice with car dealers and multiple auto loan INQs will only count as 1 FICO score wise. Sometimes you can get a better finance deal thru the dealer or perks like free auto scheduled maintainence. Most likely you won't be able to get them off your CR anyway.
Although you told them not do it, there could have been a document that you signed that gave them permission to do it. When I purchase my car, it was in the fine print of the application that I filled out. The only reason I noticed it was I had the paperwork a little longer than expected when the dealer was looking for someone to detail the car.
The issue is not one of whether or not you specifically authorized the inquiry, the issue is whether or not there is at least one permissible purpose, as listed under FCRA 604, for the inquiry.
The FCRA is intentionally structured to avoid the need for express consumer approval of inquiries by authoriziing inquiries based on whether their is a recognized and legitimate purpose. Those purposes are detailed under seciton 604.
The two types or permissible purpose that might apply would be (1) a consumer initiated request for credit, or (2) a business transaction initiated by the consumer in which the business has a legitimate business need to review the consumer's credit as part of the transaction.
Apparently, you informed them that you were NOT initiating any request for credit through them, so item (1) would not apply.
If any of the inquiries were made by a prospective creditor, and not the dealership, then it would not have a permissible purpose.
Item (2) would then be the issue.
The FTC has opined that a legitimate business need would only arise if something within the transaction would give a legitimate business concern regarding your ability to complete the transaction. They provide an example of paying cash vs paying by check.
Cash would not involve any legitimate need to review your credit, but paying by check might give a legitimate business concern regarding your credit history. The inquiry, if for legitimate business purposes, would additionally be made only by the dealership, and not a prospective creditor.
Was there anything in the business transaction that might give concern, and thus trigger a legitimate business need to review your credit report?
I'm not justifying that is is ok for them to do this but one of the reasons they do this is that hey have relationships with lenders so they can benefit from you taking out an autoloan with another lender. IMHO even if you shoed up with cash, they would still pull your credit. The only other type company that is INQ happy is the cable/cell phone ones.
Where did all of the 84 INQs come from? At most a dealer would pull all 3 and more likely only one. Same goes for the mortgage.
Oh banks and credit unions love to be quite liberal with their pulls as well. I think USBank has made something ridiculous like 12 inquiries on mine in the past 3 months. I've stopped fighting that battle. And when I bought my car I got 16 inquiries and was told the same thing about FICO scores and loan shopping windows, but found some information that contradicts what I thought to be true.
Oh banks and credit unions love to be quite liberal with their pulls as well. I think USBank has made something ridiculous like 12 inquiries on mine in the past 3 months. I've stopped fighting that battle. And when I bought my car I got 16 inquiries and was told the same thing about FICO scores and loan shopping windows, but found some information that contradicts what I thought to be true.