Back-up loan application mandatory in case bank loan check bounces?!?

[edlin303]

I thought I would ask the regulars here if this is a common situation. I am buying my first ever BMW, a 2011 e90 M3, and am surprised by the way the dealer is behaving. Perhaps it is because they have a large amount of my money already as a "deposit" so they know they have me stuck.

I ordered it over a month ago, and at the time mentioned I would be financing it elsewhere. Fast forward to last week when my M3 got off the boat, and I started asking for details about the financing process. PenFed will send loan approval information prior to the check arriving so that if the dealer is willing they can release the car to me even before the check arrives in the mail. I asked the dealer if this is ok, or if I need to get the check in hand when i come to pick it up. That question was not answered (it was one of a few questions in the email).

Today I finally get word back from them (keep in mind the car should be arriving Sat) telling me that not only will they not accept only a confirmation of the approved loan to release the car, but they will hold my credit union's cashier's check for up to 10 days before I can take my car. The only way around this is to allow them to do a credit check and fill out a "back up loan" application.

This information is all coming out after they tried to talk me into doing my loan through them multiple times, and I politely declined each time. I told them I would not give them my SSN, nor approve a credit check, because I have no intention of financing through them and tightly control who I give that information to.

Unfortunately I do not like being bullied, so I will go without my car longer rather than giving over any information.

I will post my full dealership review once I have my car out of their control, but I must say I am not enjoying the BMW experience at all so far. Obviously I am now looking around for other options for tint and bra because I do not want to give the dealer any more money than I already have committed to. I have heard Danny's is good, but they can't give me a price on a full front bra without the car in hand.

[///M Rakete]

Perhaps they've been ripped off with phony documents too many times and the cars disappear across the border. It is odd though.

[CHEM3]

is this chapman or scottsdale?

[edlin303]

Originally Posted by ///M Rakete

Perhaps they've been ripped off with phony documents too many times and the cars disappear across the border. It is odd though.

I understand that is most likely why, but when they can call the CU and confirm the loan and docs are legit, that reason becomes flawed. On top of that, I would think such a strict policy would be mentioned sooner than the week the car is due. Maybe I am just the only customer they have that worries about identity theft, and doesn't give out his SSN to everyone that asks.

My next step is to offer the full value in cash to guarantee the check. I do not want to wait two more weeks if I can avoid it. We'll see if they will go for that.

Originally Posted by CHEM3

is this chapman or scottsdale?

Scottsdale

[formgen99]

Does Penfed have echecks and does your dealership accept them. I use USAA for my bank and all I did was show up with a letter from the bank, the dealership calls with their info and the money is confirmed and transferred to the dealership in seconds.

[Its_Canuck]

Sound very unusual for a dealer to do this. Especially with the lack of communication on their part.

How was your dealings with PenFed so far in getting the loan.
I joined them a month ago (veteran status) and planned on using their services for the loan. Haven't decided on a traditional or their 'select loan' yet.

[edlin303]

Originally Posted by formgen

Does Penfed have echecks and does your dealership accept them. I use USAA for my bank and all I did was show up with a letter from the bank, the dealership calls with their info and the money is confirmed and transferred to the dealership in seconds.

The dealer has specifically said they will only trust a wire transfer or a cashier's check they witness being created at a local branch. PenFed does not offer wire transfers, but does offer phone verification of the loan, check, etc.

Originally Posted by Its_Canuck

Sound very unusual for a dealer to do this. Especially with the lack of communication on their part.

How was your dealings with PenFed so far in getting the loan.
I joined them a month ago (veteran status) and planned on using their services for the loan. Haven't decided on a traditional or their 'select loan' yet.

To be honest, I have not started the app yet, and am glad I haven't. I might look at BofA, which is claiming 3.2% loans, and if they can cut the check at a local branch while BMW watches, BMW says they will accept it without the hold. Otherwise, I am going to have to free up the cash and get a check equal to the loan amount out of my personal account just so I can pick up my car. Then they will give me my money back when the PenFed check clears.

I feel like I showed up in tattered clothes at a cash and carry dealer a few miles from the border, not a luxury car dealership I have been working with for months. If I wasn't locked into this already, I would be at least changing dealers, if not car choices too.

[996TTE92M3]

Most dealers will require you to sign a backup contract when you provide your own financing

[EJ_92606]

Originally Posted by edlin303

I thought I would ask the regulars here if this is a common situation. I am buying my first ever BMW, a 2011 e90 M3, and am surprised by the way the dealer is behaving. Perhaps it is because they have a large amount of my money already as a "deposit" so they know they have me stuck.

I ordered it over a month ago, and at the time mentioned I would be financing it elsewhere. Fast forward to last week when my M3 got off the boat, and I started asking for details about the financing process. PenFed will send loan approval information prior to the check arriving so that if the dealer is willing they can release the car to me even before the check arrives in the mail. I asked the dealer if this is ok, or if I need to get the check in hand when i come to pick it up. That question was not answered (it was one of a few questions in the email).

Today I finally get word back from them (keep in mind the car should be arriving Sat) telling me that not only will they not accept only a confirmation of the approved loan to release the car, but they will hold my credit union's cashier's check for up to 10 days before I can take my car. The only way around this is to allow them to do a credit check and fill out a "back up loan" application.

This information is all coming out after they tried to talk me into doing my loan through them multiple times, and I politely declined each time. I told them I would not give them my SSN, nor approve a credit check, because I have no intention of financing through them and tightly control who I give that information to.

Unfortunately I do not like being bullied, so I will go without my car longer rather than giving over any information.

I will post my full dealership review once I have my car out of their control, but I must say I am not enjoying the BMW experience at all so far. Obviously I am now looking around for other options for tint and bra because I do not want to give the dealer any more money than I already have committed to. I have heard Danny's is good, but they can't give me a price on a full front bra without the car in hand.

Just let them run a credit check on you...they just want to be sure they aren't dealing with a scam artist. Once that's done, most dealers will let you drive off with even just a personal check or your word that you will bring the bank loan check in the next few days.

[edlin303]

Originally Posted by EJ_92606

Just let them run a credit check on you...they just want to be sure they aren't dealing with a scam artist. Once that's done, most dealers will let you drive off with even just a personal check or your word that you will bring the bank loan check in the next few days.

That's the problem...I don't trust them with my information. Anyone who has had their identity stolen knows how bad of an idea it is to give that info to anyone you don't absolutely have to. Since they are neither loaning me money, nor paying me wages, they have no business knowing my SSN and other financial info. I would rather not even give it to banks, but I know that banks have very strict guidelines to protect that information. I would not expect a car dealer to have such strict guidelines on storage of sensitive data.

As for figuring out if I am a scam artist, it doesn't seem like it would be their problem if I am. If the bank sends a legitimate cashier's check for a legitimate loan, it is the bank that loses if I was not who I claimed. All the dealership need do is call the bank to verify it is not a fake check.

My bank loan officer is now discussing the matter with them, so I hope he can get it straightened out and find some way to get everyone what they want. If not, I am getting more and more inclined to walk away from the deal. I could give up the $3k down payment if need be, and get a 2010 for invoice - 2500 instead of the 2500 over invoice I paid for this one. Or better yet, go to a dealer willing to let me do ED on a 2011 and save even more.