6 ms·

Common misconception. They actually do need your approval, it's just that that approval is buried in the mountains of legalese you sign whenever you sign up for

Common misconception. They actually do need your approval, it's just that that approval is buried in the mountains of legalese you sign whenever you sign up for a bank account, credit card or loan.

skybrian 9y ago
Although, in the case of identity fraud, they don't have your approval. Someone else signed the paperwork.
_dark_matter_ 9y ago
So, if I don't want to give them my approval, I must: not sign up for a bank account, never open a credit card, avoid getting a mortgage, buy only in cash, stop renting [0], only apply to some jobs [1], not take out student loans... [0] Some landlords require credit approval [1] Some jobs check credit
- djsumdog 9y ago
  You also can only buy cars from individuals (dealerships run credit checks, even if you pay with cash/check/direct draft) and you probably can't get power, water, gas or Internet in your name (you'd need a roommate and have to pay them).
  - umanwizard 9y ago
    Why would a dealership need to do a credit check if I showed up with a briefcase full of money to buy a car?
    - jquast 9y ago
      Because the patriot act. https://www.edmunds.com/car-buying/car-dealership-credit-report-scams-and-the-patriot-act.html https://www.edmunds.com/car-buying/car-dealership-credit-rep... I was also very surprised to buy a car with cash, only to have a credit check required. It's a real thing. And according to this article, not required, but dealerships are confused by the language of the law and insist on running a credit check, anyway.
      - jjeaff 9y ago
        I think they know better, but they use it as an excuse to run your credit thus giving them more information about you as a buyer and an opportunity to sell you on their credit products (which is what they make their money on anyway).
      - IncRnd 9y ago
        The link you posted shows the exact opposite of what you say. The Patriot Act doesn't mandate a credit check when purchasing a car.
    - deleted 9y ago
      [deleted]
    - CryptoFascist 9y ago
      Can confirm. I bought a car last week in California with cash. Dealer did a credit check. The system is rotten and (short of moving country) impossible to avoid.
      - ovao 9y ago
        What would've happened if your reports were frozen? Would you have been denied the car?
      - seanp2k2 9y ago
        FYI dealers do this because they want to be able to offer you financing if your check bounces. It's also a way to ensure that you go through with the transaction because now your credit is worse and going somewhere else would lead to worse financing. Put a freeze on your accounts with the credit bureaus before you get serious about buying a car with cash. Tell them that they may not do a "hard pull" against your credit. If they try, complain to the appropriate government officials (not sure who this would be, some consumer protection agency) and take your cash elsewhere. It's a scam to lock you in to buying from them. I brought my own financing to a dealership and they wanted me to sign a thing which among other things authorized a credit check. I crossed that part out and signed it. This caused some back and forth with someone who was not in the room (basically my salesman had to go "get it approved") but they really wanted the sale because I drove a rental car down from 6 hours away just to buy this specific car (I had set the sale up ahead of time over email). I was very close to walking out and they probably knew it, and figured that they'd rather make the sale vs trying to sell me on their financing vs mine (I happened to get an extremely low rate from a credit union).
        JSONwebtoken 9y ago
        > It's also a way to ensure that you go through with the transaction because now your credit is worse and going somewhere else would lead to worse financing. There is no need to spread misinformation. While it is true that a hard inquiry will have a minor effect on your credit score (less than a 5 point hit), multiple hard credit inquiries from car dealerships or mortgage lenders within a period of 45 days only count as a single inquiry. You're not at all disadvantaged by taking your business elsewhere, you're just making things up to furnish your dubious story.
    - Y7ZCQtNo39 9y ago
      I bought a car by check in CA and I'm 99% sure I didn't get a credit check. I did have to prove to the seller that the account from which the check was written had sufficient funds, but that was it.
    - jlarocco 9y ago
      I'm pretty sure the credit check is done automatically by the dealership software, as part of entering a person into the system to get their paperwork filled out. It's probably done to save time because 99.9% of the time it's necessary. The credit check won't stop the sale if you're paying with a briefcase full of cash or writing a check. That said, going in with a briefcase full of cash is going to cause a lot of other problems.
    - davidcuddeback 9y ago
      They don't. I just bought a car from a dealership on August 1 without a credit check. The dealership wanted to run a credit check if I were to pay with a personal check, but not if I paid with certified funds. I called my bank to have my debit card limit raised to $40,000 for 24 hours and paid for the car on my debit card with no credit check.
      - mixmastamyk 9y ago
        Did you have to do the IRS form stuff?
        davidcuddeback 9y ago
        It's hard to recall all the forms that I signed that day. I don't remember any IRS forms.
    - cfeduke 9y ago
      You also cannot buy a house with cash. We had to launder my father's life savings in a bank for six months before we could use it to buy his house, because the seller still had a mortgage on the property when he listed the property. (Why my father's life savings was under his bed is a completely different story.)
bparsons 9y ago
Yes, but you really have zero choice. Unless you decide that you can live without a cell phone, rental car, credit card, mortgage or bank account the rest of your life.
- djsumdog 9y ago
  You can do only burner prepaid sims that don't require a name/personal info (which is a bit difficult to find) but your general point is still very valid. You cannot escape the data collection systems in our society without going all Henry David Thoreau.
  - tenpies 9y ago
    > You cannot escape the data collection systems in our society without going all Henry David Thoreau. Or living suspiciously like a drug dealer (without money laundering).
- jjeaff 9y ago
  You can get a rental car, prepaid credit cards, and prepaid cell plans without providing your SSN. Although I'm sure a mortgage and bank account wouldn't be possible.
skywhopper 9y ago
A choice you can't say no to is no choice.
pishpash 9y ago
These fake contracts are the bigger problem.
Y7ZCQtNo39 9y ago
Is it really a choice if it's necessary to participate in our economy? No bank or loan will offer terms that don't involve the use of one of these credit reporting agencies.
- beebmam 9y ago
  It is effectively not a choice, and they take advantage of that

Common misconception. They actually do need your approval, it's just that that approval is buried in the mountains of legalese you sign whenever you sign up for a bank account, credit card or loan.

skybrian 9y ago

Although, in the case of identity fraud, they don't have your approval. Someone else signed the paperwork.

_dark_matter_ 9y ago

So, if I don't want to give them my approval, I must: not sign up for a bank account, never open a credit card, avoid getting a mortgage, buy only in cash, stop renting [0], only apply to some jobs [1], not take out student loans... [0] Some landlords require credit approval [1] Some jobs check credit

djsumdog 9y ago
You also can only buy cars from individuals (dealerships run credit checks, even if you pay with cash/check/direct draft) and you probably can't get power, water, gas or Internet in your name (you'd need a roommate and have to pay them).
- umanwizard 9y ago
  Why would a dealership need to do a credit check if I showed up with a briefcase full of money to buy a car?
  - jquast 9y ago
    Because the patriot act. https://www.edmunds.com/car-buying/car-dealership-credit-report-scams-and-the-patriot-act.html https://www.edmunds.com/car-buying/car-dealership-credit-rep... I was also very surprised to buy a car with cash, only to have a credit check required. It's a real thing. And according to this article, not required, but dealerships are confused by the language of the law and insist on running a credit check, anyway.
    - jjeaff 9y ago
      I think they know better, but they use it as an excuse to run your credit thus giving them more information about you as a buyer and an opportunity to sell you on their credit products (which is what they make their money on anyway).
    - IncRnd 9y ago
      The link you posted shows the exact opposite of what you say. The Patriot Act doesn't mandate a credit check when purchasing a car.
  - deleted 9y ago
    [deleted]
  - CryptoFascist 9y ago
    Can confirm. I bought a car last week in California with cash. Dealer did a credit check. The system is rotten and (short of moving country) impossible to avoid.
    - ovao 9y ago
      What would've happened if your reports were frozen? Would you have been denied the car?
    - seanp2k2 9y ago
      FYI dealers do this because they want to be able to offer you financing if your check bounces. It's also a way to ensure that you go through with the transaction because now your credit is worse and going somewhere else would lead to worse financing. Put a freeze on your accounts with the credit bureaus before you get serious about buying a car with cash. Tell them that they may not do a "hard pull" against your credit. If they try, complain to the appropriate government officials (not sure who this would be, some consumer protection agency) and take your cash elsewhere. It's a scam to lock you in to buying from them. I brought my own financing to a dealership and they wanted me to sign a thing which among other things authorized a credit check. I crossed that part out and signed it. This caused some back and forth with someone who was not in the room (basically my salesman had to go "get it approved") but they really wanted the sale because I drove a rental car down from 6 hours away just to buy this specific car (I had set the sale up ahead of time over email). I was very close to walking out and they probably knew it, and figured that they'd rather make the sale vs trying to sell me on their financing vs mine (I happened to get an extremely low rate from a credit union).
      - JSONwebtoken 9y ago
        > It's also a way to ensure that you go through with the transaction because now your credit is worse and going somewhere else would lead to worse financing. There is no need to spread misinformation. While it is true that a hard inquiry will have a minor effect on your credit score (less than a 5 point hit), multiple hard credit inquiries from car dealerships or mortgage lenders within a period of 45 days only count as a single inquiry. You're not at all disadvantaged by taking your business elsewhere, you're just making things up to furnish your dubious story.
  - Y7ZCQtNo39 9y ago
    I bought a car by check in CA and I'm 99% sure I didn't get a credit check. I did have to prove to the seller that the account from which the check was written had sufficient funds, but that was it.
  - jlarocco 9y ago
    I'm pretty sure the credit check is done automatically by the dealership software, as part of entering a person into the system to get their paperwork filled out. It's probably done to save time because 99.9% of the time it's necessary. The credit check won't stop the sale if you're paying with a briefcase full of cash or writing a check. That said, going in with a briefcase full of cash is going to cause a lot of other problems.
  - davidcuddeback 9y ago
    They don't. I just bought a car from a dealership on August 1 without a credit check. The dealership wanted to run a credit check if I were to pay with a personal check, but not if I paid with certified funds. I called my bank to have my debit card limit raised to $40,000 for 24 hours and paid for the car on my debit card with no credit check.
    - mixmastamyk 9y ago
      Did you have to do the IRS form stuff?
      - davidcuddeback 9y ago
        It's hard to recall all the forms that I signed that day. I don't remember any IRS forms.
  - cfeduke 9y ago
    You also cannot buy a house with cash. We had to launder my father's life savings in a bank for six months before we could use it to buy his house, because the seller still had a mortgage on the property when he listed the property. (Why my father's life savings was under his bed is a completely different story.)

bparsons 9y ago

Yes, but you really have zero choice. Unless you decide that you can live without a cell phone, rental car, credit card, mortgage or bank account the rest of your life.

djsumdog 9y ago
You can do only burner prepaid sims that don't require a name/personal info (which is a bit difficult to find) but your general point is still very valid. You cannot escape the data collection systems in our society without going all Henry David Thoreau.
- tenpies 9y ago
  > You cannot escape the data collection systems in our society without going all Henry David Thoreau. Or living suspiciously like a drug dealer (without money laundering).
jjeaff 9y ago
You can get a rental car, prepaid credit cards, and prepaid cell plans without providing your SSN. Although I'm sure a mortgage and bank account wouldn't be possible.

skywhopper 9y ago

A choice you can't say no to is no choice.

pishpash 9y ago

These fake contracts are the bigger problem.

Y7ZCQtNo39 9y ago

Is it really a choice if it's necessary to participate in our economy? No bank or loan will offer terms that don't involve the use of one of these credit reporting agencies.

beebmam 9y ago
It is effectively not a choice, and they take advantage of that