Denied for an auto loan 2 weeks after purchase??

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SixAlpha
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Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Thu Jul 12, 2018 8:30 pm

My wife and I purchased a new Honda Pilot almost 2 weeks ago - signed the paperwork and picked up the car June 30. We paid cash, except for $8,000 which we financed through Honda at 0.9% to take advantage of a $1,000 "June bonus cash" offer ($8k was the minimum you could finance). Naturally, we already have the cash set aside to pay that off when the first statement comes!

Today in the mail we both received letters from Honda Finance saying our loan was denied due to low credit scores. Our household income is just shy of $100k, so I doubt income is a factor. Both of our credit scores are in the ballpark of 775, and the dealer indicated when we signed the paperwork that those numbers were more than sufficient for Honda. We picked up the car on a Saturday and in order to expedite the paperwork process, the dealer had us submit an online credit application which we did the Tuesday prior. So they had plenty of time to pre-approve the loan. I've had my identity stolen several times, so while we were doing the paperwork the finance office complained they were having troubles getting past the fraud alerts on my credit report... something about the department they'd usually call about that didn't work weekends... but thought they had a workaround. To my knowledge, that was the only hiccup during the process.

So far we haven't been contacted but the dealer. I assume they're aware the loan was kicked back, and I intend to call them tomorrow. The best scenario seems to me to just walk in there with a check and be done with it, but the dealer is 30 miles away and it would take a few days for me to have time to get over there. But I have lots of questions, including: how does a dealer let a car off the lot without first approving the financing??

Do I need to worry about the dealer attempting to farm the loan out to another bank without our knowledge? My only concern here would be getting into a loan with pre-payment penalties.

Can the dealer try to claw back the $1,000 discount since the Honda Financing fell through, or is it reasonable to expect them to eat that since it appears to be their error.

Any concern about leins on the title? Repossession?

Do we have the option of handing them the keys and demanding a refund? At this point, we've had the car for 2 weeks and have put almost 500 miles on it.

Thanks for any advice!

spth
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Re: Denied for an auto loan 2 weeks after purchase??

Post by spth » Thu Jul 12, 2018 8:35 pm

Tell them you are returning the car. I bet the problem goes away.

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FIREchief
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Re: Denied for an auto loan 2 weeks after purchase??

Post by FIREchief » Thu Jul 12, 2018 8:37 pm

It sounds to me like it's the dealer who ought to be worried! 8-)
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ResearchMed
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Re: Denied for an auto loan 2 weeks after purchase??

Post by ResearchMed » Thu Jul 12, 2018 8:41 pm

Someone else recently had something like this happen.

There weren't any problems with fraud alerts, but it was also "weekend", so they were told it was all fine, and just go home with the car, etc.
:annoyed

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TxAg
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Re: Denied for an auto loan 2 weeks after purchase??

Post by TxAg » Thu Jul 12, 2018 8:42 pm

I've read about this before. They will likely try to get the extra $1000.

If so, just write the $8k check and tell them to pound sand. That's better for them than taking back a used car.
Last edited by TxAg on Thu Jul 12, 2018 8:43 pm, edited 1 time in total.

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Re: Denied for an auto loan 2 weeks after purchase??

Post by Sandtrap » Thu Jul 12, 2018 8:43 pm

The dealer will do everything it can for you to keep the car.
1. Creative financing offers with "generous" terms.
2. And so forth.
3. It is not in their best interest to take the car back, repossess it, or anything distasteful.
4. If you wanted to take the car back they might take it back as a "used" car. They don't want it back. They want their profit.
5. Don't worry about it. Either pay cash for the balance or find financing on your own, HELOC, etc.
6. Contact the dealer and tell them what happened. They will work with you, eagerly.
7. I suspect that they might try to take back the $1000 rebate but give in if you press for it. Again, they want your business.
7. **Check for fraud. That the letter you received is legit.

Iridium
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Iridium » Fri Jul 13, 2018 1:05 am

SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
So far we haven't been contacted but the dealer. I assume they're aware the loan was kicked back, and I intend to call them tomorrow. The best scenario seems to me to just walk in there with a check and be done with it, but the dealer is 30 miles away and it would take a few days for me to have time to get over there.
They shouldn't make you come in. They should be able to straighten everything out over the phone, and then you can mail them a check.
SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
But I have lots of questions, including: how does a dealer let a car off the lot without first approving the financing??
When I worked in auto finance (on the bank side) the way it always worked is that, technically, the original loan was with the dealer, and then the dealer sold the note to us. Now, the dealer has absolutely no interest in carrying the note, so they will go through a full loan approval process and get an interest rate from the bank, so it looks like we are the ones originating it. However, technically the dealer is just getting a bid on your loan before they loan you the money. Interesting side note: the interest rate is actually negotiable between dealer and consumer; if the dealer gets a higher interest rate than we wanted, we paid the dealer a bonus for the note.

So, in a sense, financing is in place, it is just in place with the dealer. The lender probably has some contractual 'outs' with the dealer, but since they want to continue doing business with the dealer, I would guess those outs are exercised very rarely. In fact, my guess is that the rejection letter has more to do with your fraud alerts and not your actual credit worthiness. Most likely, the dealer is already calling their rep to get it straightened out.
SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
Do I need to worry about the dealer attempting to farm the loan out to another bank without our knowledge? My only concern here would be getting into a loan with pre-payment penalties.
In the unlikely event that the dealer can't get it straightened out, then the loan will get sold to someone else or they will hire a servicer to take care of it (maybe there is a provision that the dealer can demand the car back if financing falls through; don't know). Either way, provisions like prepayment penalties are contractual. A new bank could no more impose a prepayment penalty than the original bank simply deciding to do it.
SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
Can the dealer try to claw back the $1,000 discount since the Honda Financing fell through, or is it reasonable to expect them to eat that since it appears to be their error.
Legally, yes. They can probably try to claw back. Not sure if that could run them into some bait-and-switch territory. If you are reasonable in trying to help them resolve the problem (lifting credit freeze at the bureau the original bank needs to pull, say), I have a really hard time believing they would try to claw back. It would just be a bad look, even though you signed a contract that said they could.
SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
Any concerns about leins on the title? Repossession?
Well, there is already a lien. It happens to be with the dealer rather than the bank, but there was always going to be a lien against the property securing the loan. Even if the dealer wanted the car back, they would get in touch with you first. Both because it is a legal requirement, and because repo agents are expensive. I would not worry about your car disappearing overnight. Anyone who has had their car repossessed KNEW it was coming (exceptions: those who did not provide us a valid phone number, refused to talk to us, sent us a legal demand to not to contact them, or those who believed that we were just bluffing).
SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
Do we have the option of handing them the keys and demanding a refund? At this point, we've had the car for 2 weeks and have put almost 500 miles on it.
I doubt it. If the dealer is willing to honor the original terms of the loan, or find someone else willing to do so, then there's really no cause for complaint in your part, the only thing different from your perspective is the logo on the monthly statement.

SixAlpha
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Re: Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Fri Jul 13, 2018 5:56 am

Thank you all for the helpful replies so far! This whole process is making me grateful for the fact that we hold onto our cars for a very long time and only have to play this game once every ten years.
Iridium wrote:
Fri Jul 13, 2018 1:05 am

In the unlikely event that the dealer can't get it straightened out, then the loan will get sold to someone else or they will hire a servicer to take care of it (maybe there is a provision that the dealer can demand the car back if financing falls through; don't know). Either way, provisions like prepayment penalties are contractual. A new bank could no more impose a prepayment penalty than the original bank simply deciding to do it.
So would it behoove me to call up the dealer today, let them know we received rejection letters, and ask how they want to proceed? Or would it be better to hold off and give them a couple of days to work things out on their end?

fourwheelcycle
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Re: Denied for an auto loan 2 weeks after purchase??

Post by fourwheelcycle » Fri Jul 13, 2018 7:53 am

I recently ordered a new car that offered a $1,500 discount if I took out at least a $10K loan and did not do an early pay-off until after at least five monthly payments. My credit is locked due to past identity info hacks at our health insurance company and at Equifax. The dealer asked me to authorize a one time credit check and a few days later called to say my loan was pre-approved. The pre-sale agreement, signed by me and the dealer, Indicated the price, the loan, and the fact that I wanted the car to be titled to both me and my wife. I made a $3K deposit as part of the pre-sale agreement.

After the car had arrived, the day before we were scheduled to pick it up, the dealer called to say they could not title the car to my wife and me unless my wife's name was also on the loan. They asked me to re-apply for the loan with my wife as a co-applicant. I said no, my wife does not want to become involved in any loans, and they should read the pre-sale agreement they had signed. I said I would buy the car at the stated price, paying cash in full, net of the $1,500 loan discount, or they could return my $3K deposit and I would shop for another car. They "went to talk to their manager" for a few minutes and then came back on the phone and said OK, I could buy the car at the stated price, net of the loan discount, without taking out a loan.

I think you should call the dealer, explain that you received the loan denial, and ask if they want to leave your sale in place, as is with no price adjustment, or have you bring in the car to return it in exchange for a check for your full purchase payment.

RickBoglehead
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Re: Denied for an auto loan 2 weeks after purchase??

Post by RickBoglehead » Fri Jul 13, 2018 8:35 am

Delayed denials for car loans or leases is not uncommon. I know of someone that handed the keys back several weeks later.

OP should read the paperwork to see if the $1,500 was conditional on Honda approving the loan.

Ford Credit rebates are conditional on Ford Credit accepting the financing.

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Pajamas
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Pajamas » Fri Jul 13, 2018 8:53 am

Focus on the reason for the denial and seek to correct it in order to get the loan to go through. Might be something as simple as not being able to get information without you on the phone because of a hold on your credit or using a credit agency with some incorrect information due to the history of identity theft. Don't worry about the rest of it unless it becomes necessary because you aren't able to reverse the denial.

JuniorBH
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Re: Denied for an auto loan 2 weeks after purchase??

Post by JuniorBH » Fri Jul 13, 2018 9:24 am

Agree with the others; at this point, I would offer to either:

1. Immediately pay off the outstanding balance in cash without foregoing the incentive you received (which was your plan in a months time anyway)

or

2. Return the car and take your business elsewhere.

From this thread and the other one, it seems like a common practice to complete the sale with the assumption the financing will go through; I'm sure that's because they dealers are afraid letting you walk out the door and come back gives a chance for the deal to fall through. They should shoulder the risk of the financing not coming through though, not you.

Iridium
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Iridium » Fri Jul 13, 2018 1:13 pm

SixAlpha wrote:
Fri Jul 13, 2018 5:56 am
Thank you all for the helpful replies so far! This whole process is making me grateful for the fact that we hold onto our cars for a very long time and only have to play this game once every ten years.
Iridium wrote:
Fri Jul 13, 2018 1:05 am

In the unlikely event that the dealer can't get it straightened out, then the loan will get sold to someone else or they will hire a servicer to take care of it (maybe there is a provision that the dealer can demand the car back if financing falls through; don't know). Either way, provisions like prepayment penalties are contractual. A new bank could no more impose a prepayment penalty than the original bank simply deciding to do it.
So would it behoove me to call up the dealer today, let them know we received rejection letters, and ask how they want to proceed? Or would it be better to hold off and give them a couple of days to work things out on their end?
It needs to get straightened out before your first payment would be due and you cannot ignore the dealer if/when they reach out. I would have expected the dealer to be a bit more proactive, to be honest. If it gives you peace of mind to call them, go ahead, but with the expectation that they won't say anything other than 'we'll look into it' and call you back later. If you want to wait until they call you, I see no harm in waiting a week or so after receiving the letter.

Rupert
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Rupert » Fri Jul 13, 2018 1:19 pm

OP, you might find this thread from just a few months ago helpful. viewtopic.php?f=2&t=248386

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Re: Denied for an auto loan 2 weeks after purchase??

Post by brokendirtdart » Fri Jul 13, 2018 1:33 pm

RickBoglehead wrote:
Fri Jul 13, 2018 8:35 am
Delayed denials for car loans or leases is not uncommon. I know of someone that handed the keys back several weeks later.

It happened to a friend of mine back in the early 90s. Bought a new car and had to return it about 10 days later due to credit issues.

For curiosity's sake only, how is this possible in the age of almost instantaneous credit checks? Too many decision makers in the company providing the loan away from their desks at the same time?

Scrapr
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Scrapr » Fri Jul 13, 2018 1:49 pm

I have heard dealers use this as a ploy to bump the interest rate. Get you into the car for a few days and you "love it". Then come back with the denial and change the terms. As iridium says the loan is first with the dealer. If they can bump the rate maybe the spread between the dealer & the bank increases. And not withstanding any bonus on the higher rate

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Earl Lemongrab
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Earl Lemongrab » Fri Jul 13, 2018 2:56 pm

Rupert wrote:
Fri Jul 13, 2018 1:19 pm
OP, you might find this thread from just a few months ago helpful.
Not very, as there never was a resolution. The OP just quit answering.
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123
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Re: Denied for an auto loan 2 weeks after purchase??

Post by 123 » Fri Jul 13, 2018 3:02 pm

spth wrote:
Thu Jul 12, 2018 8:35 pm
Tell them you are returning the car. I bet the problem goes away.
+1 Be ready to return the vehicle. Hopefully you didn't do a trade-in that would leave you short of a set of wheels.
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Earl Lemongrab
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Earl Lemongrab » Fri Jul 13, 2018 3:20 pm

123 wrote:
Fri Jul 13, 2018 3:02 pm
spth wrote:
Thu Jul 12, 2018 8:35 pm
Tell them you are returning the car. I bet the problem goes away.
+1 Be ready to return the vehicle. Hopefully you didn't do a trade-in that would leave you short of a set of wheels.
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Cash is King
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Cash is King » Fri Jul 13, 2018 3:43 pm

SixAlpha wrote:
Thu Jul 12, 2018 8:30 pm
My wife and I purchased a new Honda Pilot almost 2 weeks ago - signed the paperwork and picked up the car June 30. We paid cash, except for $8,000 which we financed through Honda at 0.9% to take advantage of a $1,000 "June bonus cash" offer ($8k was the minimum you could finance). Naturally, we already have the cash set aside to pay that off when the first statement comes!

Today in the mail we both received letters from Honda Finance saying our loan was denied due to low credit scores. Our household income is just shy of $100k, so I doubt income is a factor. Both of our credit scores are in the ballpark of 775, and the dealer indicated when we signed the paperwork that those numbers were more than sufficient for Honda. We picked up the car on a Saturday and in order to expedite the paperwork process, the dealer had us submit an online credit application which we did the Tuesday prior. So they had plenty of time to pre-approve the loan. I've had my identity stolen several times, so while we were doing the paperwork the finance office complained they were having troubles getting past the fraud alerts on my credit report... something about the department they'd usually call about that didn't work weekends... but thought they had a workaround. To my knowledge, that was the only hiccup during the process.

Op, I would suggest calling the dealer because if your score is 775 that is not considered low. I think the fraud alerts are causing the problems and should be easily resolved.

So far we haven't been contacted but the dealer. I assume they're aware the loan was kicked back, and I intend to call them tomorrow. The best scenario seems to me to just walk in there with a check and be done with it, but the dealer is 30 miles away and it would take a few days for me to have time to get over there. But I have lots of questions, including: how does a dealer let a car off the lot without first approving the financing??
Op, it's not uncommon for the dealer to let the car go based on the consumer's credit score especially on the weekends when an approval may be delayed. As I stated previously, the fraud alerts are probably the issue.

Do I need to worry about the dealer attempting to farm the loan out to another bank without our knowledge? My only concern here would be getting into a loan with pre-payment penalties.
No, because there's a high probability the $1,000 rebate was based on the vehicle being financed through Honda so the contract would need to be rewritten.

Can the dealer try to claw back the $1,000 discount since the Honda Financing fell through, or is it reasonable to expect them to eat that since it appears to be their error.
If the loan is not financed with Honda you are not entitled to the $1,000 dollars and this is not bait and switch. There's usually disclosures stating certain rebates are based on financing with the captive.

Any concern about leins on the title? Repossession? There's always a lien on the title unless you pay cash for the vehicle.

Do we have the option of handing them the keys and demanding a refund? At this point, we've had the car for 2 weeks and have put almost 500 miles on it. Yes. Again, please contact the dealer this may be resolved. The dealer may have already contacted Honda and resolved the fraud alert issue.

Thanks for any advice!

hilltide
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Re: Denied for an auto loan 2 weeks after purchase??

Post by hilltide » Fri Jul 13, 2018 3:50 pm

It is common however most are approved right away. However, with those scores they will probably rehash the deal with Honda or put it somewhere else. hold your ground either way. they will do everything they can to make it work. I would not be worried. You hold the cards... and the car.

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Pajamas
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Pajamas » Fri Jul 13, 2018 4:00 pm

brokendirtdart wrote:
Fri Jul 13, 2018 1:33 pm
For curiosity's sake only, how is this possible in the age of almost instantaneous credit checks? Too many decision makers in the company providing the loan away from their desks at the same time?
It is not really possible unless it is intentional. Auto dealers and their salespeople know all the tricks in the book. They sell cars every day and their livelihood depends on it. The car buyer is nothing more than an easy mark for their shenanigans.

SixAlpha
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Re: Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Fri Jul 13, 2018 7:48 pm

Thanks again for all your responses. I read through all of our paperwork, and interestingly there’s no mention or line item anywhere for finance incentives, nor the dealer’s ability to claw them back if financing falls through. The contract does specifically say our loan will be sold to Honda. This means the dealer must have just backed the $1,000 out of the purchase price as part of the negotiation.

My wife did call the dealership today. Our salesman basically said “not my problem” and transferred her to the finance guy. The finance guy insisted everything looked fine on his end and said something to the effect of “everyone gets those letters by default..I must have just forgotten to uncheck the box so you didn’t get that letter.” Sounded like a pretty weird explanation to us, and even though he said not to worry, I’m still not sure I buy it.

mortfree
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Re: Denied for an auto loan 2 weeks after purchase??

Post by mortfree » Fri Jul 13, 2018 8:10 pm

Do you have enough info to create an online account at Honda financial services for this vehicle?

Or have you called them?

SixAlpha
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Re: Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Fri Jul 13, 2018 8:17 pm

mortfree wrote:
Fri Jul 13, 2018 8:10 pm
Do you have enough info to create an online account at Honda financial services for this vehicle?

Or have you called them?
Good question. The only contact info provided on the letters we received was for TransUnion. I’ll look into that.

Update: no, HFS requires an account number to register online which in included in your welcome packet which I assume is mailed.

mortfree
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Re: Denied for an auto loan 2 weeks after purchase??

Post by mortfree » Fri Jul 13, 2018 8:26 pm

SixAlpha wrote:
Fri Jul 13, 2018 8:17 pm
mortfree wrote:
Fri Jul 13, 2018 8:10 pm
Do you have enough info to create an online account at Honda financial services for this vehicle?

Or have you called them?
Good question. The only contact info provided on the letters we received was for TransUnion. I’ll look into that.

Update: no, HFS requires an account number to register online which in included in your welcome packet which I assume is mailed.
Yep. I would get in touch with Honda financial when they are open.

Almost seems that what the dealer finance guy told you about those letters may be accurate.

I’ve financed three vehicles with HFS. Always smooth.

Cash is King
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Cash is King » Fri Jul 13, 2018 8:40 pm

SixAlpha wrote:
Fri Jul 13, 2018 7:48 pm
Thanks again for all your responses. I read through all of our paperwork, and interestingly there’s no mention or line item anywhere for finance incentives, nor the dealer’s ability to claw them back if financing falls through. The contract does specifically say our loan will be sold to Honda. This means the dealer must have just backed the $1,000 out of the purchase price as part of the negotiation.
SixAlpha, I'm sure getting the $1,000 was based on the vehicle financed through Honda. I think you would agree based on your original comments. The dealer needs to show you that the rebate was applied to the purchase.

My wife did call the dealership today. Our salesman basically said “not my problem” and transferred her to the finance guy. The finance guy insisted everything looked fine on his end and said something to the effect of “everyone gets those letters by default..I must have just forgotten to uncheck the box so you didn’t get that letter.” Sounded like a pretty weird explanation to us, and even though he said not to worry, I’m still not sure I buy it.
You only get these type of letters if the application is denied. It sounds like they pulled Trans Union to determine your approval. AHFS is not a direct lender like a bank or credit union so you can't go to them directly for financing.
Did you ask the finance guy if the loan is approved?

Cash is King
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Cash is King » Fri Jul 13, 2018 8:49 pm

We paid cash, except for $8,000 which we financed through Honda at 0.9% to take advantage of a $1,000 "June bonus cash" offer ($8k was the minimum you could finance). Naturally, we already have the cash set aside to pay that off when the first statement comes!

I would say you already knew that you would get $1,000 rebate if you financed with Honda based on this comment. If the bonus cash was not disclosed on the contract as a rebate did you ask how it was applied. For example, did the reduce the selling price by $1K?

47Percent
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Re: Denied for an auto loan 2 weeks after purchase??

Post by 47Percent » Fri Jul 13, 2018 8:54 pm

A very basic question. Do you have the pink slip (title paper) for the car?

I suspect the title will be issued in someone else's name (usually the financing company). If the transaction is incomplete, it could be in the original dealer's name as inventory. In any case, for all the money parted with (Total price - $8K (loan) - $1K (incentive)), you have a car that doesn't have clear title, and you cannot sell.

So, even if the dealer doesn't call back, or doesn't contact you in any way for the foreseeable future, there is always this cloud hanging as you are driving a car that is not yours.

Of course, all the above assumes that you don't have the title papers.

In any case, I think you should sort it out instead of waiting; if nobody gives you a straight answer call the local TV or radio station "Action line". They would love to give a spin and be the hero's. Also, the dealership will be a lot more responsive to them.

Cash is King
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Cash is King » Fri Jul 13, 2018 8:58 pm

47Percent wrote:
Fri Jul 13, 2018 8:54 pm
A very basic question. Do you have the pink slip (title paper) for the car?
How could he have the pink slip if he did not pay cash for the car ?

I suspect the title will be issued in someone else's name (usually the financing company). If the transaction is incomplete, it could be in the original dealer's name as inventory. In any case, for all the money parted with (Total price - $8K (loan) - $1K (incentive)), you have a car that doesn't have clear title, and you cannot sell. :oops:

So, even if the dealer doesn't call back, or doesn't contact you in any way for the foreseeable future, there is always this cloud hanging as you are driving a car that is not yours.

Of course, all the above assumes that you don't have the title papers.

In any case, I think you should sort it out instead of waiting; if nobody gives you a straight answer call the local TV or radio station "Action line". They would love to give a spin and be the hero's. Also, the dealership will be a lot more responsive to them.

SixAlpha
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Re: Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Fri Jul 13, 2018 9:05 pm

Cash is King wrote:
Fri Jul 13, 2018 8:49 pm
We paid cash, except for $8,000 which we financed through Honda at 0.9% to take advantage of a $1,000 "June bonus cash" offer ($8k was the minimum you could finance). Naturally, we already have the cash set aside to pay that off when the first statement comes!

I would say you already knew that you would get $1,000 rebate if you financed with Honda based on this comment. If the bonus cash was not disclosed on the contract as a rebate did you ask how it was applied. For example, did the reduce the selling price by $1K?
I saved all of the back-and-forth emails with the dealer while we were negotiating as well as a copy of the original “pencil”. They did apply it by reducing the selling price by $1,000. Agreed that the discount was contingent on financing through Honda, based on our email discussion.

SixAlpha
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Re: Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Sat Jul 14, 2018 1:28 pm

Cash is King wrote:
Fri Jul 13, 2018 8:40 pm

Did you ask the finance guy if the loan is approved?
By way of update, the finance guy has assured us that we are approved and have nothing to worry about. I have to be at the dealership on Monday anyways to drop off the car for service, so I’ll double check in person while I’m there. Still seems bananas to me.

47Percent
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Re: Denied for an auto loan 2 weeks after purchase??

Post by 47Percent » Sat Jul 14, 2018 1:58 pm

SixAlpha wrote:
Sat Jul 14, 2018 1:28 pm

By way of update, the finance guy has assured us that we are approved and have nothing to worry about. I have to be at the dealership on Monday anyways to drop off the car for service, so I’ll double check in person while I’m there. Still seems bananas to me.

Bananas all right!

If I were you I would make sure my ride doesn't leave till I am finished "double checking" with them.

Good luck. Please post update.

Cash is King
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Re: Denied for an auto loan 2 weeks after purchase??

Post by Cash is King » Sat Jul 14, 2018 4:26 pm

SixAlpha wrote:
Sat Jul 14, 2018 1:28 pm
Cash is King wrote:
Fri Jul 13, 2018 8:40 pm

Did you ask the finance guy if the loan is approved?
By way of update, the finance guy has assured us that we are approved and have nothing to worry about. I have to be at the dealership on Monday anyways to drop off the car for service, so I’ll double check in person while I’m there. Still seems bananas to me.
It sounds crazy but if one's application is turned down or conditioned the letter automatically goes out even if the loan ends up being approved. It's a Truth and Lending requirement.
I think in your case the Fraud Alert caused the initial decline. It sounds like all is good. :sharebeer

crazygrow
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Re: Denied for an auto loan 2 weeks after purchase??

Post by crazygrow » Sun Jul 15, 2018 10:27 am

This happened to me last year with ford. We got a denial letter so I called the dealership and they showed approved. I logged into my ford account and it was indeed approved and all set up in there. Never got a good explanation.

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LiveSimple
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Re: Denied for an auto loan 2 weeks after purchase??

Post by LiveSimple » Sun Jul 15, 2018 11:03 am

[quote="Cash is King" post_id=4020161 time=1531603598 user_id=127835

It sounds crazy but if one's application is turned down or conditioned the letter automatically goes out even if the loan ends up being approved. It's a Truth and Lending requirement.
I think in your case the Fraud Alert caused the initial decline. It sounds like all is good. :sharebeer
[/quote]

This may be the case

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midareff
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Location: Biscayne Bay, South Florida

Re: Denied for an auto loan 2 weeks after purchase??

Post by midareff » Sun Jul 15, 2018 11:11 am

Sandtrap wrote:
Thu Jul 12, 2018 8:43 pm
The dealer will do everything it can for you to keep the car.
1. Creative financing offers with "generous" terms.
2. And so forth.
3. It is not in their best interest to take the car back, repossess it, or anything distasteful.
4. If you wanted to take the car back they might take it back as a "used" car. They don't want it back. They want their profit.
5. Don't worry about it. Either pay cash for the balance or find financing on your own, HELOC, etc.
6. Contact the dealer and tell them what happened. They will work with you, eagerly.
7. I suspect that they might try to take back the $1000 rebate but give in if you press for it. Again, they want your business.
7. **Check for fraud. That the letter you received is legit.
LOL, throw down a 2% cash back credit card and make $160 for your time and trouble. End of March a Benz dealer let me put $37.5K on a 2% cash back card. I'm not sayin' he liked it but.... away we went and the whole whether the dealer likes it or not thing is truly secondary to whether I do. In lieu of that how about a big bag of 8000 one dollar bills.

j0nnyg1984
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Re: Denied for an auto loan 2 weeks after purchase??

Post by j0nnyg1984 » Sun Jul 15, 2018 12:38 pm

Scrapr wrote:
Fri Jul 13, 2018 1:49 pm
I have heard dealers use this as a ploy to bump the interest rate. Get you into the car for a few days and you "love it". Then come back with the denial and change the terms. As iridium says the loan is first with the dealer. If they can bump the rate maybe the spread between the dealer & the bank increases. And not withstanding any bonus on the higher rate

It gets especially tricky when the new car buyer trades in their existing vehicle. I've heard stories of the dealer claiming that the trade in vehicle is already gone, and that there is nothing they can do.

Pure scum.

ResearchMed
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Re: Denied for an auto loan 2 weeks after purchase??

Post by ResearchMed » Sun Jul 15, 2018 12:43 pm

j0nnyg1984 wrote:
Sun Jul 15, 2018 12:38 pm
Scrapr wrote:
Fri Jul 13, 2018 1:49 pm
I have heard dealers use this as a ploy to bump the interest rate. Get you into the car for a few days and you "love it". Then come back with the denial and change the terms. As iridium says the loan is first with the dealer. If they can bump the rate maybe the spread between the dealer & the bank increases. And not withstanding any bonus on the higher rate

It gets especially tricky when the new car buyer trades in their existing vehicle. I've heard stories of the dealer claiming that the trade in vehicle is already gone, and that there is nothing they can do.

Pure scum.
Sheesh.

I would leave the keys and walk out the door, as I tell them I'll just buy a car at a different dealer.
And then I'd rent a car for a few days (or a bit longer) while I find the car I wanted elsewhere.
Even if it's a model/trim level that the first dealer had right there...

RM
This signature is a placebo. You are in the control group.

SixAlpha
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Re: Denied for an auto loan 2 weeks after purchase??

Post by SixAlpha » Thu Jul 19, 2018 9:21 pm

By way of update, we had the Pilot back into the dealer this week to get some warranty work done (a defective window molding and some paint chips that I asked them to touch up as a condition of sale). They didn't hold the car hostage, and the General Manager of the dealership was very kind to my wife when she picked up the car. Seems like a good sign to me. 3 weeks in and still haven't received any paperwork in the mail from Honda Finance though...

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