Rental car inquiries

[Anonymous]

---

RobertEG wrote:

Is this a hidden section of the FCRA that permits hard pulls without prior consumer consent?

---

As a follow up to my previous post, and for further clarification, the section that allows hard pulls without prior consent is not hidden at all.  It is Section 604, "Permissible purposes of consumer reports."

604(a)(2) establishes PP when the entity pulling the report has written consent.  That does not mean consent is required under any other paragraphs of Section 604.  Written consent is a sufficient condition for PP, but it is not a necessary condition.

In fact, none of the other paragraphs in Section 604 mention consent of the consumer at all as a prerequisite for the existence of PP, with the exception of 604(b)(2) regarding employment inquiries, as I mentioned in my previous post.

As a matter of fact, 604(a)(3)(F)(i) is very, very broad in its requirements to establish PP.  All that is required is "a legitimate business need for the information in connection with a business transaction that is initiated by the consumer."

Notice that that business transaction doesn't even have to be credit-related in order for PP to exist.

Message Edited by cheddar on 07-01-2008 03:29 PM

[RobertEG]

WOW!  I have reviewed the FCRA, and apparently they can do hard pulls without prior consumer notifification:

FCRA text:

Information regarding inquiries. Except as provided in section 609(a)(5)

[§1681g], a consumer reporting agency shall not furnish to any person a record of

inquiries in connection with a credit or insurance transaction that is not initiated

by a consumer.

§ 609. Disclosures to consumers [15 U.S.C. § 1681g]

(a) Information on file; sources; report recipients. Every consumer reporting agency shall, upon request, and subject to 610(a)(1) [§ 1681h], clearly and accurately disclose to

the consumer:

(5) A record of all inquiries received by the agency during the 1-year period

preceding the request that identified the consumer in connection with a credit or

insurance transaction that was not initiated by the consumer.

[Anonymous]

Robert, please see my prior two posts regarding PP and Section 604.

What you posted is accurate (that a hard inquiry may be pulled without consent), but not for the reasons you seem to think!

Section 604 establishes PP without regard to the hard vs. soft inquiries distinction.

The section you posted DOES make the distinction between hard and soft inquiries.

It says that no record of inquiries may be produced (with one exception) when those inquiries are in connection with a credit or insurance transaction that is not initiated by the consumer.

So, according to that section, the only inquiries that may be hard inquiries fall into two groups:

1) credit or insurance transactions initiated by the consumer, OR

2) non-credit and non-insurance related inquiries.

The exception specified in 609(a)(5) indicates that even though the inquiries prohibited in te section above from being hard inquiries do not show up on one's reports, they SHOULD appear to a consumer when one pulls one's OWN reports.  (i.e., they are SOFT inquiries)

There is nothing in what you posted that indicates a hard pull is permissible even without consent of the consumer.  (Even though it is permissible in certain circumstances, according to Section 604.)

Edit, since we cross-posted:  Happy to help as always, Robert!

Message Edited by cheddar on 07-01-2008 03:45 PM

[RobertEG]

Thanks again, Cheddar.  I stand corrected.  I know all of this is very legal and technical, but thank you for detailing it for me.  I now understand, and hope that others also do.

Message Edited by RobertEG on 07-01-2008 03:47 PM

[Anonymous]

I know this doesnt really have to do with the rental car questions I posed when starting this thread, but it does have to do with unauthorized inquiries.

about 18 months ago I applied to refinance my car. The bank or whoever it was my wife (my wife does most of the banking stuff) decided to apply to, decided to send my application to over 5 different places to see what they could get. Iknow that multiple inquireis of the same type don't hurt as much, but I was shocked when I got 3 rejections since we had only applied once. I guess we need to read the fine print, or they need to disclose better.

In less than 2 weeks my last inquiry should drop off.

Stephen

[Anonymous]

Let me muddy the waters now that Cheddar has so expertly cleared them up.

Section 609(a)(3)(A) requires the CRA to disclose to you the ID of everyone who gets your CR. Technically, even if a creditor had no PP whatsoever, the CRA has to list the inquiry on your report. So removing an inquiry is illegal because the CRA is rewriting history.

Of course, it's doubtful they will get slapped for it, because it's highly unlikely that any consumer will sue a CRA because they REMOVED an inquiry.

Not a sermon.  Just a thought.

[Anonymous]

---

masdeocho wrote:

Let me muddy the waters now that Cheddar has so expertly cleared them up.

Section 609(a)(3)(A) requires the CRA to disclose to you the ID of everyone who gets your CR. Technically, even if a creditor had no PP whatsoever, the CRA has to list the inquiry on your report. So removing an inquiry is illegal because the CRA is rewriting history.

---

Crystal clear, mas.  Of course.

This is also why some CRAs won't even allow you to dispute inquiries, and regard them as statements of fact.  When you dispute an inquiry, you're not saying, "Hey, So-And-So had no right to pull my report!"  Instead, you're saying, "Hey!  So-And-So never pulled my report!"

To which the CRA responds, "Uh.  Yes they did."

For a non-PP inquiry, you have recourse against the non-PP puller as well as against the CRA in question, but there is technically no provision for removing a non-PP inquiry.

[Anonymous]

But cheddar, an inquiry can be either hard or soft, and by disclosing all inquiries under both categories would satisfy the law.   Which means that there should be no problem with a creditor (or a CRA, by the way) changing a hard to a soft.   The inquiry still exists so no law was broken.   The law does not say that the inquiry must be a "hard".  That is something the CRA's made up, right?

The law should be modified to be more specific on what is 'hard' and what is 'soft', since for scoring purposes it matters alot!  And the scores are the only reason why any of us are even here, right?

[Anonymous]

---

Boscoe wrote:

But cheddar, an inquiry can be either hard or soft, and by disclosing all inquiries under both categories would satisfy the law.   Which means that there should be no problem with a creditor (or a CRA, by the way) changing a hard to a soft.   The inquiry still exists so no law was broken.   The law does not say that the inquiry must be a "hard".  That is something the CRA's made up, right?

---

You make a good point.  It seems a CRA or creditor could recode a hard inquiry as a soft one and still be within the letter of the law.

Hard vs. soft is not something the CRAs made up.  It is a distinction made in the FCRA, although the FCRA does not use those words and the hard vs. soft distinction is not all in one place in the FCRA.  See my discussion of Section 609 above for the origin of the hard vs. soft distinction.

[Lucid08]

Maybe I'm missing something, but isnt the issue here whether or not the creditor, or rental agency in this case, has to 'notify' the consumer when they intend to pull a CR? When I opened my checking account I was told by the bank rep. that it would occur, and whenever I have rented a car in the past with my debit card the rental agent has always told me up front that it would occur. I was under the impression that there is a disclosure requirement involved anytime an entity is required to pull a CR on someone(hard or soft). Even my auto insurance agent informed me of this ahead of time. 5 points could be the difference between a good interest rate, or an even better one sans the 5 point drop.