Paid for car with a check.. the dealer did a hard pull (against my wishes)

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Hi FWF,

A few months ago I bought a car with a check for $29k (they let me put $3k on a credit card). Because I used a personal check, the dealer said that they needed to do a credit check. I said that I did not want a hard credit pull and they said that it is only a soft credit pull. "Don't worry!"

A few days ago I checked my credit and at least one bureau shows a hard credit pull by this dealer that expires in two years. This bureau lists my credit at around 840 at the time if that matters.

What I want to know is what are my options. Do I write a letter to the manager? Dispute the pull with the credit bureau? Gasp/yikes... go to a lawyer first?

Basically, I was told it would be soft so I want to make sure that it is deleted from my report. I just want what I agreed to. Seems reasonable, right?

Thanks for your input!

Here is a thread that I read before that seems similar:
https://www.fatwallet.com/forums/finance/1430084
 

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22) dcwilbur, it might not seem like a big deal to some, but to me it is. First and foremost, I was lied to and second, ... (more)

truvia (Jan. 13, 2017 @ 2:33p) |

You went into a car dealership and are surprised you were lied to (or at least someone not very well informed told you w... (more)

fwuser12 (Jan. 13, 2017 @ 4:02p) |

Stuff happens. I've accepted I'll get a hard inquiry even if I came in with a suitcase full of cash.

burgerwars (Jan. 13, 2017 @ 5:06p) |

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How about picking up the phone and calling them or stopping by?

Why does America think lawyer before taking a logical step?

You have an 840 credit score, one hard pull isn't going to do anything. While the manager should have given you the proper information it's frankly not worth your time and effort. If anything, put it on one of those satisfaction surveys they hand out.

Or just go to the dealership and make a light stink and have them throw in some free service or a hat or something.

Am I the only one who snickers every time I hear people debating about getting a hard pull instead of a soft pull?  

Seriously, this is not a big deal.  The credit guy was right to check your credit; he was wrong to tell you that it would be a soft inquiry.  But you probably should have known that anyway.  No credit check run by someone as part of a credit application (which is what they were doing so that they could backstop your personal check with a loan just in case...) is going to ever be a soft inquiry.  If you have an 840 credit score, the couple of points damage has already gone away.

truvia said:   Because I used a personal check, the dealer said that they needed to do a credit check. I said that I did not want a hard credit pull and they said that it is only a soft credit pull. 
  Who is "they"? The cashier? I don't think she would even know what a hard pull is. Don't say it.

dcwilbur said:   Am I the only one who snickers every time I hear people debating about getting a hard pull instead of a soft pull?  

Seriously, this is not a big deal.  The credit guy was right to check your credit; he was wrong to tell you that it would be a soft inquiry.  But you probably should have known that anyway.  No credit check run by someone as part of a credit application (which is what they were doing so that they could backstop your personal check with a loan just in case...) is going to ever be a soft inquiry.  If you have an 840 credit score, the couple of points damage has already gone away.
 

 No!  I laugh as well! 

And the Reg does not mention a soft or hard pull it just talks about when they have Permissionable Purpose which OP gave. 

As a former auto and real estate underwriter, I didn't differentiate much between an 801 and 850 score.  It's all good to me. 

you sure you don't have paperwork somewhere that you signed saying you're consenting to a credit pull (regardless of hard or soft)?

If it was that big of a deal to you, you should have walked out the door. There's no reason to do a credit pull when you're not using credit to pay for something.

Another new member trying to cause trouble.

I'd just try to dispute it off of there. But forget litigation. You'll be hard-pressed to prove that selling someone a 20k car isn't a permissible purpose. And even if you prevailed, what would your damages be? A 10-20 point drop when you're already in the 800s isn't worth much.

Yeah, this is ultimately meaningless. As long as your score is above a 740, you'll get the best rate. An 840 score is suspicious though, may just be a fako score like Vantage which goes up to 950 instead of the real scores that are used for mortgages, they top out between 839-850. The hit to the score is about 3-5 points. You can raise a big stink at it at the dealership and they will think you are nuts which is what everyone here is basically saying. Basically they probably had you sign some form that gave them permission to pull your score, otherwise you could try and sue them for $1k for pulling your score illegally. Also in the situation you described, it was impossible for them to do a soft pull.

This is pretty standard practice. Checks can bounce, cashier's checks can be counterfeit. The dealer will often write-up the purchase contract as a financing arrangement with 1-payment. That way if your 1-payment falls through, they'll have a finance agreement to come after you with. They often ask for a credit authorization agreement for you to sign, saying an excuse like patriot act requires us to verify your identity, that's why we need your SSN (or some other lame excuse).

It does suck though.

Don't believe anyone who tells you that a credit inquiry will be soft. If you don't want them to check your credit, don't sign the form that allows them to check your credit.

Unless someone denies you credit because of this inquiry (or too many inquiries) or gives you a higher APR, you don't have any losses, so there's no reason to talk to a lawyer. The only thing you could do is talk to the dealer and ask them nicely to either remove the hard or re-coded it as soft. They probably won't be able to, and if you signed the form, there's nothing you can do to force them.

Hi everyone! Thanks for the replies!

I was just asking FWF if someone was in the same boat and what they did and how that worked out for them. I'm leaning on writing a letter to the manager. I'll update you when/if I hear back from the dealership.

1) Tennis8363: going to a lawyer is NOT something that I want to do. It is not my first choice. I only put it out there in case someone else had to go that route.

2) S197: thanks for your comment. The hard pull may not harm me in the near future. I don't know. I guess it is the principle of being told one thing and getting another thing instead.

3) Ma171aC: I like that idea. I'm leaning on sending a letter at first. I'll have to see what they say.

4) dcwilbur: I actually didn't know that they were going to do a hard pull. If this thread does anything, it should let people who want to write a check to know that they might be given wrong information. The bank was blocks away from the dealer and since I was told it would be a soft pull, I agreed to let them do a soft pull. And ONLY a soft pull...

5) atikovi: the person who told me that it was going to be a soft pull was the guy who did a test drive with me. He also shuffled the papers between me and the manager.

truvia said:   5) atikovi: the person who told me that it was going to be a soft pull was the guy who did a test drive with me. He also shuffled the papers between me and the manager.
  That would be the salesman, most of which barely know anything about the car they are demoing, let alone finance. 

6) ach1199: Thanks for the comment!

7) imbatman: Thanks for the comment. I'm looking for my paperwork right now.

8) TravelerMSY: Thanks for the comment!

9) henry33: Thanks for the comment! My problem is with the person who told me a lie. They understood the differences between hard and soft and told me soft. You mentioned that it would have been impossible to do a soft pull. Why is that? Thanks!

10) novocane: Thanks for your comment! It does suck. I just hope that this thread helps someone who might find themselves in a similar position.

11) scripta: Thanks for the comment! Thanks for the advice! I like that and I think a friendly approach is best!!!

Am I in a parallel universe where a newbie op is actually replying and posting thanks to boot?

novocane said:   This is pretty standard practice. Checks can bounce, cashier's checks can be counterfeit. The dealer will often write-up the purchase contract as a financing arrangement with 1-payment. That way if your 1-payment falls through, they'll have a finance agreement to come after you with. They often ask for a credit authorization agreement for you to sign, saying an excuse like patriot act requires us to verify your identity, that's why we need your SSN (or some other lame excuse).

It does suck though.
I may be buying a car soon and I've often wondered about this myself. So I googled, and here's what I found so far:

  • Dealers are only required to get SSN to report cash transactions over $10K to IRS. According to the explanation for Form 8400, "cash" does not include personal or cashier's checks in the amount above $10K (it may include them if multiple checks under $10K are used). Some of the rules surrounding the reporting of cash transactions were affected by the PATRIOT Act, so this very common excuse may not be entirely wrong. I'm too lazy to research the details.
  • Dealers may need to verify ID and check the name against OFAC counter-terrorism lists, but they don't need SSN for that.
  • Some states (Ohio?) require SSN to process the car registration / title.
  • Even this LA Times article has is completely wrong, but at least the comments rip it apart (too bad the article wasn't pulled or updated).
  • This Edmunds article -- edmunds.com/car-buying/car-dealership-credit-report-scams-and-the-patriot-act.html -- is spot-on.

I conclude that some dealers are either too ignorant, stupid, or risk averse to allow you to pay so much by check without running your credit.

I guess just get an agreement in writing that the only reason they need SSN is for identity purposes, and NOT to check credit?

Providing SSN is not at all mandatory. I had a fully-approved auto-loan-check from PenFed coming in the mail next day (that was not specifically made to any dealer - it's those scenarios where you apply and credit unions approve you for a specific amount), so I negotiated with the dealer and said I am not providing you My SSN, will give you the check and will wait to pick up the car till it clears. He was more than Happy and signed the contract same day for the best price. He needed a day to transfer the Car from another dealer. I went back 3rd day with the check, and his Finance Manager verified the funds over phone to PenFed and delivered the car right same day. I told him at the very beginning that Dealers run all such scams with checking credit, so I am willing to walk away from the deal any point they ask me for SSN. He was very fine with it. I went via Costco Dealer program but had the best quote in My Hand (from a dealer 70 miles away). Costco quote came higher, so I showed the email quote and told him to match it. SalesMan was an older gentleman and was quite respectable in this dealership, so he did not BS much...went back and forth a couple times to his boss and got the deal signed.

op, just let it go and chalk it up to a lessons_learnt. with a score of 800+ you are already in the best possible credit rating bucket....there is no adverse impact....
yours was a personal check....so dealer may have had his reasons to cover his ass....if you really didn't want any hits then you could have taken the approach to give the check and wait for funds to clear before picking up the car.

dcwilbur said:   Am I the only one who snickers every time I hear people debating about getting a hard pull instead of a soft pull?  

Seriously, this is not a big deal.  The credit guy was right to check your credit; he was wrong to tell you that it would be a soft inquiry.  But you probably should have known that anyway.  No credit check run by someone as part of a credit application (which is what they were doing so that they could backstop your personal check with a loan just in case...) is going to ever be a soft inquiry.  If you have an 840 credit score, the couple of points damage has already gone away.

  More importantly they informed you that they were checking your credit, the law makes no distinction between hard and soft pulls, and the dealer had permissible purpose.

Bring the issues up to the general manager, and hope her chucks in some free service.

dealgain said:   Providing SSN is not at all mandatory. I had a fully-approved auto-loan-check from PenFed coming in the mail next day (that was not specifically made to any dealer - it's those scenarios where you apply and credit unions approve you for a specific amount), so I negotiated with the dealer and said I am not providing you My SSN, will give you the check and will wait to pick up the car till it clears. He was more than Happy and signed the contract same day for the best price. He needed a day to transfer the Car from another dealer. I went back 3rd day with the check, and his Finance Manager verified the funds over phone to PenFed and delivered the car right same day. I told him at the very beginning that Dealers run all such scams with checking credit, so I am willing to walk away from the deal any point they ask me for SSN. He was very fine with it. I went via Costco Dealer program but had the best quote in My Hand (from a dealer 70 miles away). Costco quote came higher, so I showed the email quote and told him to match it. SalesMan was an older gentleman and was quite respectable in this dealership, so he did not BS much...went back and forth a couple times to his boss and got the deal signed.
  Just so you know, an SSN is not required to do a credit check.

There was someone on here who spoke about this awhile back. They would always hand-write a clause to purchase contracts basically saying that the dealer would not do a hard pull and if so would pay them $650 since the monetary value of a hard pull cannot be easily calculated.

He ended up having to take a dealer to small claims about it once and won. Don't remember his username though.

For the OP though, you're SOL.

Chargum85 said:   ...would pay them $650 since the monetary value of a hard pull cannot be easily calculated...Sure it can. For the last 5 years my hard inquiries were expected to (and did) produce either (1) a credit card sign up bonus worth at least $400, with the current median of $775 and average of $895, or (2) lower my mortgage rate, saving tens of thousands in interest.

$650 sounds very reasonable. I'll try to remember this.

12) scripta: thanks for sharing your research. I couldn't get the edmunds article though. Going to try to search for it.

13) raceman73: Thanks for your comment. I wonder if I could have written a simple contract on some paper on the fly with those conditions on it.

14) dealgain: thanks for your comments. I think I should have told the dealer that I would give them a check and that I would wait for them to verify that the funds were there so that we could avoid dealing with my credit. Sigh

15) stanolshefski: thanks for your comments. I didn't know that the law makes no distinction between hard and soft pulls. I would be happy if they threw some free service in for the trouble. We'll see...

16) Chargum85: thanks for the comment. I hope I'm not SOL. We'll see.

I think I will write a friendly letter to the dealer via mail. I'll keep you all posted on what kind of response I get (if any?) Thanks for the comments.

scripta said:   I conclude that some dealers are either too ignorant, stupid, or risk averse to allow you to pay so much by check without running your credit.
I don't think you are understanding.  A personal check doesn't offer the dealer much protection.  If you write a personal check or get outside financing, it is standard practice to have the buyer sign a credit application, and more often than not, the dealer will run a credit check, before they will let you drive the car off the lot.  That way, if your check bounces or you don't show up with your outside financing, they can process a loan and still make the sale.  If your check clears, or the outside financing is good, they'll put the credit app in the shredder.

They aren't ignorant or stupid.  Being "risk averse" is just good business.  

Sorry OP. You are SOL.

And if you want to stand on principle against heavily resourced entities it's a very lonely place. Because 99/100 times you'll lose. Hardly anybody stands up or cares anymore. Ain't the 21st century [& probably the last 10-20 yrs of the 20th century] grand?

OP - Something is wrong with FW redirect to edmunds. Try copy/paste/replace "%2F" with "/" from the original link. Or try this:
edmunds.com/car-buying/car-dealership-credit-report-scams-and-the-patriot-act.html

dcwilbur -- for a personal check, sure. For a cashier's check they can just call the bank and verify it.

scripta said:   OP - Something is wrong with FW redirect to edmunds. Try copy/paste/replace "%2F" with "/" from the original link. Or try this:
edmunds.com/car-buying/car-dealership-credit-report-scams-and-the-patriot-act.html

dcwilbur -- for a personal check, sure. For a cashier's check they can just call the bank and verify it.

  1) Car dealers are typically open well outside banker's hours.

2) You have heard of cashier's check fraud, right?

If this is not a first world problem, then I don't know what is.

seawolf21 said:   If this is not a first world problem, then I don't know what is.

Maybe complaining that someone else's complaint was too trivial to justify the attention you gave it?

Just write a Yelp review and be done with it.

~~dcwilbur;19756025 said:
Am I the only one who snickers every time I hear people debating about getting a hard pull instead of a soft pull? 

You much not use Chase very much.
dcwilbur said:   
scripta said:   I conclude that some dealers are either too ignorant, stupid, or risk averse to allow you to pay so much by check without running your credit.
I don't think you are understanding.  A personal check doesn't offer the dealer much protection.  If you write a personal check or get outside financing, it is standard practice to have the buyer sign a credit application, and more often than not, the dealer will run a credit check, before they will let you drive the car off the lot.  That way, if your check bounces or you don't show up with your outside financing, they can process a loan and still make the sale.  If your check clears, or the outside financing is good, they'll put the credit app in the shredder.

They aren't ignorant or stupid.  Being "risk averse" is just good business.  

  When I wrote a personal check for my car a few months ago, the finance guy had me pull up my bank account right then and there, show them the balance, and email a (redacted) screenshot of the account.  There was also a form to sign basically saying that would sue the crap out of me if it bounced.  No credit check. 
For the OP, I would contact the dealer first for them to request to remove on their own accord.  You can also dispute the pull directly with the bureaus if in fact you didn't sign any authorization.

Paging codename47!

 

stanolshefski said:   
scripta said:   OP - Something is wrong with FW redirect to edmunds. Try copy/paste/replace "%2F" with "/" from the original link. Or try this:
edmunds.com/car-buying/car-dealership-credit-report-scams-and-the-patriot-act.html

dcwilbur -- for a personal check, sure. For a cashier's check they can just call the bank and verify it.
1) Car dealers are typically open well outside banker's hours.
2) You have heard of cashier's check fraud, right?
Alright. Could I take a salesperson to the bank and have the bank issue the cashier's check?
I understand there could be issues, I'm just trying to think of a solution before this happens to me.

Why not just wire the funds? That's how we paid for our last new car. No dicking around with checks and credit reports.

Skipping 14 Messages...
Stuff happens. I've accepted I'll get a hard inquiry even if I came in with a suitcase full of cash.



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