pierno80

Hi Everyone,

I need some advice here. I am about to finance a Mercedes with a loan from my credit union. So I'm basically financing the car through my own bank, not Mercedes Benz Financial. The Dealer contacted me and told me that I still need to fill out the credit application even if they don't run my credit. Has anyone had any experience? Dealer says it is for security purposes. Is this process normal?
Thanks for your help.

SW20S

No, if you are financing through your credit union its same as cash to the dealer. They should not need you to fill out a credit app.

2012 merc amg

Agreed, not normal. Run. They make more money doing their own financing and are trying to get you to finance through them.

superpop

This is normal. They do not know who you are, and a credit score gives them some reassurance that you are not a scammer or crook. It has nothing to do with them trying to sell you financing, they want to understand who they are dealing with. I would not worry about it.

Jud Chapin

I personally would not fill out a credit application for anyone or any company unless I was financing something thru them. First of all you are providing your SSN and other personal info to who knows how many employees at the dealership. Secondly, if it's a hard inquiry, it can lower your credit score. I've bought a lot of cars and have never heard of this. They don't need to know such info. And what does a credit check have to do with security. In reality, if someone were to come in with cash or check in hand, I can't imagine the dealer turning the deal down because the buyer did not complete a credit app.

A car dealer is there for one purpose and that is to sell cars. Not sell cars to only those who have high credit scores.

places

What difference does it make? How can a scammer scam a car?

I would not fill this out, it's not relevant.

superpop

Cash or Check in hand are not what they used to be, that is why they want to run credit. Lots of people run scams with checks, and cash can come from unsavory places that can cause drama. It is not a big deal, and unless you are buying cars every 6 months, one inquiry on your credit reports will cause negligible impact.

hyperion667

Is there a different dealer in your area?

superpop

They are trying to weed out "Straw Buyers" who come in with cash or even a cashier's check. This is a problem at higher end dealers where people come in, plop down a pile of cash and drive off with the car. They then take the car overseas, typically to China, where they flip it for a nice profit. Great for the flipper but is pisses off the manufacturer and they punish the offending dealer. None of this is technically illegal but none the less it does happen. That is one example of why they want to understand the buyer. In another example a buyer walks in with what looks like a cashiers check, that has been modified to reflect the amount owed for the car. They drive off with the car, strip it for parts and the dealers insurance is left holding the bag, which costs them money. Lots of scams unfortunately. A credit report gives a clear picture of how legitimate a buyer is. If you do not like it, pick another dealer but most high end dealers require this.

hyperion667

Awww, poor dealers........did someone rip them off before they had a chance to rip someone off?? So sad LOL!

SW20S

No way is it appropriate for a car dealer to require that they run a credit app when they aren't doing the financing. Nobody is pulling a copy of my credit report unless I am applying for credit through them. No way, no how. Credit inquiries have consequences.

The only time I have seen this happen where its legitimate is when the buyer is paying with a personal check. That I get. Bust cash, cashiers check, wire, expecting you to let them pull your credit in order to sell you a car for cash is completely unreasonable.

You can buy a HOUSE for cash without having to have anybody pull your credit.

as.thompson

When I bought my S550 a few years ago, I paid with a personal check. The dealer's finance/paperwork guy had me fill out the credit form which I did since, as far as they knew, my check could bounce. Since they were trusting me with my check and their car I trusted them with the credit form. Nothing untoward ever came of it.

places

Correct, it is NOT appropriate. Yet they still "require". It's B.S.

as.thompson

But remember, a house and a car a very different items - a house can't be moved and you disappear with it as with a car.

Jud Chapin

There's no question that there are bogus checks, cashier and otherwise. When you present a check to a dealer, though, it's cashed immediately before you drive off. If you don't believe this, try it. And by the way, there's a much, much easier way to get cars to strip and/or send overseas. Steal them. I doubt there is a car manufactuer in the world that gives a crap about who buys their cars with the one possible exception, Bugatti, that has very limited production. There's a lot drug dealers out there driving high end vehicles.

And as far as providing your SSN to anyone who asks for it, not a good idea. Ever have your idenity stolen? If not, talk to someone who has. This is my last post on this ridiculous topic. All due respect, but I don't think you are well versed in this area.

places

I get that, but still unnecessary. Purely subjective on the dealers part. I'd still pass and go somewhere else.

Also in case of OP, dealer should be more specific than "security purposes" if they are going to run a credit check.

hyperion667

I paid 'cash' (checks from the bank) for all my cars.....I even purchased a Pcar (used) with a check card I have never had a credit card and have always 'paid as I go'.

SW20S

Like I said above, thats a personal check, thats different. When you pay with a cashiers check or a bank draft or a draft from an outside lender, all of those things can be confirmed to be legitimate prior to releasing the car to you.

But a house is much, much harder to get possession of once its in the hands of the purchasing party than a car.

superswiss

Check fraud is unfortunately a thing. Even if the dealer deposits a check right away, it takes up to 3 weeks to be cleared and within that time it can still bounce. If you write a personal check, they could call your bank to verify the funds, but you could raid your bank account afterwards and let the check bounce. Even cashiers checks can be fake, but it's easier to verify them by calling the bank as the funds were already taken out of the individual's bank account and the bank guarantees to meet their obligations.

Credit reports are used for much more these days than applying for credit, and there are different inquiries that institutions can make. Soft inquiries for example don't count against your credit rating. I paid cash for my car and they also wanted to run my credit report, because they assumed I would be paying with a personal check or handing them a suitcase full of cash that could have been stolen. Once I told them that it would be a cashiers check, they backed off. I think they still ran some kind of a background, but I didn't hand them my SS#. Also, I have a freeze on all our credit files due to all the various data breaches that have occurred in the past and fraudulent transactions I had to deal with. I was also a victim to minor identity theft a while back, but I caught it the day it happened because it raised a red flag with the creditors, so I got lucky and they denied the fraudulent credit application on their own. The nice thing about the freeze is that nobody can run a credit report unless I explicitly lift the freeze.

Jud Chapin

Actually checks are electronicly cleared immediately. I bought my Lexus in '13 and paid by personal check. The finance guy took my check, left the room, and came back a few minutes later giving it back to me saying it had cleared.

superpop

Not always, the last two cars I purchased, I wrote them a check, and they did not cash the check for a few days on both. I thought you were done commenting on this dumb thread.

VKS400

Do not let them run it. There is absolutely no need and is not required. Your credit score will take an unnecessary hit.

places

I'm not sure if a single hard pull will negatively impact credit. I think that it would need to be more than one in a short time frame as far as I know.

VKS400

You'd be surprised.

MBS63AMG

This is not normal and I wouldn't do it. Your credit union should speak directly with the MB F&I agent at the dealership and WIRE the money immediately for the purchase of the car into the dealer's account before taking delivery. The dealer has all the rights in the world to question the credit union (getting confirmed router #s, and other identifying addresses, phone numbers, etc). The credit union personnel should also digitally send over the credit report as a copy so that the inquiry is not repeated. Also, have your car insurance updated showing that you have insurance on this particular car. Give them the name of the agent and let them talk to the insurance agent. >>>>>> The dealership should feel at ease at this point. On top of all of that, a simple agreement between you and the MB dealership should be drawn up that puts the dealership at liability if your credit is pulled at a later time over this since they will be in possession of your credit report. I would get your lawyer to draw up something simple for this. Shouldn't be over $300.