Sep 17, 2023

The Credit Score Myth That Could Cost You at the Car Dealership—Debunked!

Why Multiple Credit Checks Won’t Ruin Your Credit Score and What Really Matters When Financing a Car


Hey everyone,

If you're like most people, you probably have some misconceptions about credit scores—especially when it comes to buying a car. Today, we're debunking one of the most widespread myths that multiple dealership credit checks will send your credit score plunging into the abyss.

By the way, if you're more of a visual learner, don't forget to check out my YouTube Shorts video where I get right to the point. [Insert Video Link Here]

The Myth: Multiple Credit Checks Are a Credit Score Killer

Let's cut to the chase. You've probably heard that if a car dealership shoots your credit out to multiple lenders, it's a one-way ticket to destroying your credit score. Well, guess what? That's pure fiction.

The Truth: How Credit Pulls Really Work

In reality, when you're shopping for a car loan and multiple inquiries are made within a short time window (typically 14-45 days depending on the scoring model), these multiple pulls are counted as ONE inquiry. Credit scoring models aren't naive; they know you're not about to buy a whole fleet of cars. You're simply shopping around for the best rate.

Extra Credit: The Four Pillars of Loan Approval

Forget the idea that your credit score is the be-all and end-all. Lenders look at what I like to call the 'SACE' formula:

  1. Stability: Your employment history and residential stability.
  2. Ability: Your ability to repay the loan based on income.
  3. Credit: Yes, your credit score matters, but it's just one piece of the puzzle.
  4. Equity: The down payment or trade-in you bring to the table.

The Power of Pre-Approval

Here’s a pro-tip: Get pre-approved for a loan BEFORE you walk into a dealership. Why? Here are the benefits:

  • You'll know exactly what you can afford.
  • You get a benchmark interest rate, making it easier to spot a bad deal.
  • You'll have additional negotiating power.

Conclusion: Knowledge is Power, Ignorance is Expensive

Look, your credit score is not just a number; it's a lifestyle. And if you're in the professional world, understanding the nuances can save you a lot of money and stress. So, don't be a victim of misinformation. Arm yourself with the facts and make smarter financial decisions.

Call to Action

Have you ever fallen for this myth? Or perhaps getting pre-approved helped you land an unbeatable deal? Share your experiences in the comments below.

And if you found this information valuable, don't forget to like, share, and subscribe for more credit wisdom.

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Let's Get Started!

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