How to avoid dealers’ clandestine credit checks

Here at Consumer Reports, we think it’s important to protect your personal information to guard against fraud and identity theft. But if you’re shopping for a new car, dealers don’t make that easy. Before you can take a test drive, many dealers we’ve encountered will ask for your drivers’ license and may make a photocopy of it.

On the surface of it, this makes sense: Before they hand you the keys to a new $20,000 or $30,000 car, they want to make sure you’re licensed to drive it.

But your driver’s license contains all the personal information a salesman needs to run your credit report: your name, address, and birth date. 

Some former dealership employees have told us that salespeople routinely use this information to do a credit check when you give them your license. Two of the major credit bureaus, Trans Union and Equifax confirmed that it is possible to get a credit report without a consumer’s social-security number, though they say they need your permission.

While it seems reasonable for a dealership to verify you have a drivers license before letting you drive a car, we recommend you tell the dealership specifically that you are not authorizing a credit check when you’re only shopping around to see what car you might want to buy. Only authorize a credit check by filling out a loan application after you’ve made up your mind.

For more advice on new car-buying, check out our car buying advice resource center and read the full report “Car dealers can use your drivers license to access your credit report” on our Money blog.

—Eric Evarts

Comments

[Cale]

Eric Evarts writes, "...tell the dealership specifically that you are not authorizing a credit check when you’re only shopping around to see what car you might want to buy."

Seems reasonable to me but hardly much of a deterrent. If the dealer isn't supposed to make a credit check without your SS number, I don't see how making an explicit request will stop unscrupulous sellers from getting the credit report anyway. How about advocating the Trans Union, Equifax, etc. not provide credit reports without a social security number?

BTW, it is my opinion that you may be perpetrating a "most car dealers aren't to be trusted" myth. The article comes out blazing with references to "fraud and identity theft" then produces nothing of substance to support that these may be valid concerns when car shopping.

I think what you're saying is that unauthorized credit checks aren't nice. Car dealers would say that suggesting when you go for a test ride that the sales staff might make a unauthorized credit check is implying they're dishonest and THAT'S not nice.

[everett whitney]

Hi - - -

In my shopping for the various next new one, I simply refuse to provide anything at all except my insurance card from the existing model ....

IF that isn't sufficient, there is always another dealer that DOES accept it as sufficient!

everett

[frazgo]

I wish I new about this stunt prior to visiting a dealer in Pasadena a few years ago. They ran a credit report without telling me while I was on the test drive. I was not happy with the deal and walked. A few weeks later I found out about the credit inquiry when I actually sat down with a dealer to buy a new car. Fortunately it didn't screw up my deal, but I learned then to tell the dealers no report from that experience.