Report to Credit Bureau
Car Dealer Scam
Buying a Car Won't
Help Your Credit Here...
Report to credit bureau...Will they? Won't they? Which ones? and Why?
If you are buying a car and are also hoping to rebuild your credit in the process, there are some key questions to ask the car dealer.
The report to credit bureau scam is most common with Buy Here Pay Here lots.
These Buy Here Pay Here lots offer in house financing and will not only sell you the car, but will also loan you the money to buy it.
Here are some key questions to ask
to ensure you are getting "credit" for your credit:
If they report to credit bureaus, then they are essentially making it easier for you to become another dealers customer in the future!
- Will You Report To The Credit Bureaus?
If their answer is no here, then you can do with it what you like. If you still want to buy the car, go ahead.
Just know that the next time you buy a car you will have in no way improved your credit and you'll probably have to buy your next car from the same dealer and/or a dealer that offers similar in house financing options.
- Do You Report Monthly?
Assuming they answered yes to question number one, you'll want to know that they will report your account on a regular monthly basis.
I've seen many a Buy Here Pay Here lot say that they do report to the credit bureaus and will lead you to believe that they report monthly, but in reality they will only report after the loan is paid in full.
This has very little positive impact on your credit, because it does not show your monthly pay history and will look as if you made one payment for the full loan amount.
- What Credit Bureaus Do You Report To?
This is where a Buy Here Pay Here lot can be very tricky..."Sure we report to the credit bureau on a monthly basis!" That's not a lie, but what they fail to tell you is that they report to a credit bureau that is not commonly used in your region of the country.
For instance, I know of a Buy Here Pay Here lot in my town that will report to Equifax only.
That doesn't seem bad on the surface, but the problem is that the auto lenders in my area don't use Equifax. They use Experian primarily and Transunion as their secondary.
The dealership will do this because they don't want you to improve your credit.
If you improve your credit it's highly unlikely you'll go back to them when you are ready to buy another vehicle.
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