Dinged my Credit - Please explain what happened.

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nvtech
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Dinged my Credit - Please explain what happened.

Postby nvtech » Mon Nov 25, 2013 12:11 pm

Guys,

1st I am not sure where to post this but I am putting in the general Credit card talk.

My credit scores across all bureaus are in the 730 range.
Have one student loan and over 10 credit card accounts with less than 10% over all utilization.

I was shopping for Auto car loan and I put out 6 applications with different lenders hoping to get a best interest rates.

All the 6 lenders did hard pull on my Equifax credit.

5 of the lenders pre-approved and the 6th one denied my application stating too many inquiries and also informed my credit score was 680.

I was little panicked and I did request my FICO score on Equifax and I found my score dropped from 730 to 680.

This is a straight 50 point drop. I called Equifax customer service and they informed me that all the inquires are hard they are going to be on my credit for 2 years.

I was always under an assumption that even though I put multiple applications within a 1-2 week range for Auto loan, they all would be counted as one inquiry.


Can you please let me know what could have happened here. I feel I have screwed big time with my credit.



Also,
One of the credit union says they would like to offer a Credit card without any additional pull. There is nothing special about having that credit card.
Is it worth to take the card?..Will it help me in any way?..


Obi-dan
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Postby Obi-dan » Mon Nov 25, 2013 12:28 pm

Did you find any changes or anything unexpected on your report?
Cards:
Chase Sapphire Preferred
Marriott Rewards
Citi Hilton
Barclay Arrival
AMEX BCE (member since 95)
Chase Freedom
Discover It
Wells Fargo Platinum
Barclaycard (Apple)
Local Credit Union Visa (buy local!)


FICO Scores:
TU: 824 (Aug 2014)
Experian: 789 (Aug 2014)
Equifax: 807 (Aug 2014)

MemberSince99
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Postby MemberSince99 » Mon Nov 25, 2013 12:29 pm

I had the same thing happen - the devilship, I mean dealership, ran 6 inquiries when I only wanted to go with NMAC for my Nissan. I was not too pleased and I vowed next time around they will NOT be authorized to pull my credit under any circumstances, I will line that up ahead of time.

Anyway they should all get coded that way I'd say that just hasn't happened yet just keep an eye on it.

nvtech
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Postby nvtech » Mon Nov 25, 2013 12:45 pm

Obi-dan wrote:Did you find any changes or anything unexpected on your report?


No other changes. Everything the same as to the prior week. Its only the score that dropped.

nvtech
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Postby nvtech » Mon Nov 25, 2013 12:49 pm

MemberSince99 wrote:I had the same thing happen - the devilship, I mean dealership, ran 6 inquiries when I only wanted to go with NMAC for my Nissan.


For me, its a weird story. I myself put out 2 applications got loans approved through Penfed and Stanford Federal.

The stupid dealer insisted that the deal is on table only if I finance through "Honda Financial Services" else the deal is called off.
I thought he would send the application only to HFS but he rather sent out for 3 more lenders.

In total, 6 hard pull and 50 point drop.

Is it gonna go away in a month?

What do you suggest on the credit union offering me a credit card. Will it do any good?

DoingHomework
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Postby DoingHomework » Mon Nov 25, 2013 1:40 pm

nvtech wrote:I thought he would send the application only to HFS but he rather sent out for 3 more lenders.

In total, 6 hard pull and 50 point drop.

Is it gonna go away in a month?

What do you suggest on the credit union offering me a credit card. Will it do any good?


Did you get it in writing that they could only apply you for HFS? I bet you signed a normal dealer credit application that gives them the right to do whatever they want. NEVER sign one of those! Never sign anything at a car dealership that is not a form provided by your state. You have fallen victim to a very old trick.

You are stuck with the 6 inquiries for 2 years. You are done applying for credit for at least that long. You have plenty of cards. Use the next 2 years to develop a hobby other than collecting credit cards. Forget about the credit union card.

I would have sympathy for you but you have suffered no real harm. Who cares if your credit score was lowered. You have no reason to be applying for credit.

MemberSince99
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Postby MemberSince99 » Mon Nov 25, 2013 2:08 pm

DoingHomework wrote:Did you get it in writing that they could only apply you for HFS? I bet you signed a normal dealer credit application that gives them the right to do whatever they want. NEVER sign one of those! Never sign anything at a car dealership that is not a form provided by your state. You have fallen victim to a very old trick.

You are stuck with the 6 inquiries for 2 years. You are done applying for credit for at least that long. You have plenty of cards. Use the next 2 years to develop a hobby other than collecting credit cards. Forget about the credit union card.

I would have sympathy for you but you have suffered no real harm. Who cares if your credit score was lowered. You have no reason to be applying for credit.


Dude, seriously? Have you been reading too much of MyFICO? Mine affected my socre only as one inquiry despite there being 6 of them. Yeah I screwed up but lesson learned but it didn't destroy my life or my credit for 2 years. It doesn't even affect your score at ALL after a year. You know that. Yet he's all done for 2 years? And he has no reason to be applying for credit? Sseriously who the hell are you to say that?

Sounds WAY too over the top and MyFICOish here I'm hoping this is just your sense of humor or you are having a REALLY bad day here.....

DoingHomework
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Postby DoingHomework » Mon Nov 25, 2013 2:17 pm

Since I mentioned an old trick I will explain what I meant:

You are shopping for cars. Before you settle on a specific make, model, car, or dealership a salesman says "Let's see what kind of deal we can get you. You give a little information, sign a form, and he applies you to half a dozen or more different lenders. If you have decent credit you'll be approved by the first couple of lenders then some denials will come through for too many inquiries.

Guess what - you are over a barrel with your pants down. You either buy a car from this guy at whatever price he decides to give you or you walk. You will not be able to get approved anywhere else. He has the only approval that you will get under his control.

I believe this is exactly what happened to you. It is slimy but I don't think it is illegal, or at least it's hard to prove there was any criminal intent.

I suggest you educate yourself for the future. It is not necessary to apply before getting an interest rate commitment. They can give you a commitment based on a score - i. e., a rate of 5.4% with a required score of 720, 6.4% for a score between 650 and 719, etc. Better yet, go to your bank or credit union and get the financing prearranged before setting foot on the dealer lot. Refuse to discuss financing and ask only for cash price. Only after a cash price has been agreed for a specific VIN number that you have in writing should you even consider discussing financing. Tell the salesman what interest rate and term (years) he has to beat and give him an idea of your credit score. Get a contingent loan commitment in writing before you sign anything. This process has worked for me. I have bought cars for cash, financed through a bank, and also financed with a dealership. You can make this work if you are a firm negotiator and are prepared to walk away.

DoingHomework
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Postby DoingHomework » Mon Nov 25, 2013 2:22 pm

MemberSince99 wrote:Dude, seriously? Have you been reading too much of MyFICO? Mine affected my socre only as one inquiry despite there being 6 of them. Yeah I screwed up but lesson learned but it didn't destroy my life or my credit for 2 years. It doesn't even affect your score at ALL after a year. You know that. Yet he's all done for 2 years? And he has no reason to be applying for credit? Sseriously who the hell are you to say that?

Sounds WAY too over the top and MyFICOish here I'm hoping this is just your sense of humor or you are having a REALLY bad day here.....


Not having a bad day at all...

Inquiries stay on for 2 years. Yes, they have less score impact after a few months or a year as you say. But they will still be there for 2 years and will have some impact.

Honestly, I do pity the OP for having been duped by an old trick (see my other post). But the only harm is a lower score for a couple of years. It's not the end of the world. That would be a problem for some people but the OP has 10 times the credit available compared to what is needed (stated 10% utilization). That means there should be no need to apply for any more for 2 years. Two years is not that long.

nvtech
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Postby nvtech » Mon Nov 25, 2013 2:59 pm

DoingHomework wrote:
Guess what - you are over a barrel with your pants down. You either buy a car from this guy at whatever price he decides to give you or you walk. You will not be able to get approved anywhere else. He has the only approval that you will get under his control.

I believe this is exactly what happened to you. It is slimy but I don't think it is illegal, or at least it's hard to prove there was any criminal intent.




I am not even that close to the situation what you put out.

I have 2 pre-approvals for 1.49%...from my credit unions.
When we finally confirmed to the numbers on what I am buying, I offered to make the entire payment using the pre-approval check from SFCU.
Here is where the problem started.
The business manager of the dealership comes and he says the price they are offering is the lowest and this deal can be done only if I agree to take financing from the HFS.
I asked what the heck they are you doing. All they told me is they are not making anything on the car deal. When asked to explain the rationale in financing with them, they explained that every year Honda gives certain amount of money to the dealer for financing and they would make commission out of it. All they tell me is just take the financing from them and I can pay back before the 1st statement gets generated.

I made a real big deal on the car but in the end they messed up my credit.

The stupid finance guy had no clue when I asked him why the heck he sent my application to 3 different banks other than HFS.
All he said was for best rates.. Damm...I myself had the best rates.



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