More and more, people arrange for their own financing before buying cars or other big-ticket consumer items (boats, refrigerators, etc.) In my own opinion, this is a superior idea. However, such consumers then fill out credit applications at the dealership, which in turn pulls the consumer’s credit and lowers the consumer’s credit score with a “hard pull”. This is entirely unnecessary.

I have received many calls over the years from consumers who tell me (and I generally believe them) that they verbally told the dealership not to pull the credit report, but the dealer does anyway. Can they do anything? Usually, no. I address this problem in a very recent correspondence with a woman named Rebecca, which follows:

“Dear Mr. Brennan, I have a questions I went to a dealership to buy a car, did not do business with them financially I already had my loan from the credit union and I told them this, thy promised me they wouldn’t pull my credit or touch anything like that. Once I signed the paper work from them to send the buyers order and sticker to my credit union etc. I came to work the next morning had got notice that the dealership pulled my credit regardless and its showing on all 3 bureu’s what can I do? Signed, Rebecca”

“Dear Rebecca, if you signed something from the dealer authorizing them to pull your credit, there’s not a lot you can do. Unfortunately at many car lots, etc., the authorization to pull your credit is in small print and you would not normally notice it unless you were specifically looking for it. I usually advise consumers to specifically look for and cross out the language giving the dealer the right to pull a credit report, if indeed the consumer is not going to be applying for financing through the dealer. If the consumer already has his or her own loan, there’s absolutely no reason for the dealer to pull credit, but dealers will often pull credit anyway to find out how much they can upcharge the consumer with worthless add-ons on their loan, such as window etchings, leather treatment, etc.

“However, the moral of this story is, don’t rely on verbal assurances that the dealer will not pull credit. You need to read through the purchase contract, or other dealer documents, and find the language allowing them to pull credit, and cross it off. Or, give them a letter with your signature stating that you positively do not grant them permission to pull credit, and obviously keep a copy for yourself. It needs to be in writing to get anywhere with an unauthorized credit access claim.”