In the US, is it required by law for the dealership to run a credit application on a purchaser even if you are paying are cash?

 

Absolutely not! I could understand wanting a cashier's check if they don't know you and are concerned about taking a personal check. Mine did not a little over three years ago. I suppose the law could have changed.

 

No credit application if a cash buyer, just show them the money and drive off.

 

No, but if you are paying with cash (as opposite to check or other methods in the U.S. bank system), they are required a file a statement with the IRS if the amount is $10k+.

 

No credit check needed or required. I ordered mine with a deposit and paid weeks later in cash.

 

I also placed a $1000 deposit to order the car. I will be paying by check, if I purchase.

The CA indicated that they were required to get a copy of my driver's license and a copy of my insurance verification. He stated that even if I were paying by check, they were required by law (he mentioned FEMA) to make certain that I was not on a terrorist watch list. He also said that they were required to run a "five line" credit report. If this is a law.....I will reluctantly comply, however, if it is a dealership policy.....I consider it to be invasive, and I will not comply.

 

I have provided a copy of driver's license and insurance for a test drive and even for a loaner while my car is being serviced, but never at the time of purchase. And I really find it hard to believe that a credit report is required. Frankly the info on your license and insurance should provide the dealer all the info needed show you are not on the terrorist watch list. Tell the CA that you will pay cash and that you will not allow a "five line" credit check. If you are not financing the car, they have no business running this report. It is invasive. Stand your ground. A cashier's check is completely safe, no chance of your personal check bouncing. Tell that is what they are getting and if it is unacceptable, you'll take your business elsewhere...

 

Well, yes and no. A cashier's check should be completely safe. A forgery of a cashier's check might be harder to spend.

Still no reason for the credit check.

 

As a follow-up: I phoned the Texas Attorney General's office and was referred to the Texas Department of Transportation, Motor Vehicle Division. This is the licensing and enforcement agency in the state for car dealerships. The following points were confirmed:

-No dealership is allowed to pull a credit report on a consumer unless the consumer has given written authorization

-No credit report is required or necessary in a cash deal or a deal that is not financed through the dealership

-If a dealership in Texas insists that you allow them to pull a credit report for a cash deal or a deal not financed through them, you should report them to the Tex Dept of Trans, Motor Vehicle Division at (800) 687-7846.