Multiple hard inquiry for a single loan from car dealer?
"(I'm a bit surprised that nobody talked about the impact of multiple inquiries on a loan, since OP is concerned with credit building. Probably an answer as opposed to a comment is justified.) Yes. In fact when you shop for auto loan you are expected to have your credit score/report be pulled by different banks, credit unions, and/or the financing arm of the car manufacturer or the dealership, so that you can hopefully get the best rate possible. This is especially true if the dealer is requesting quotes on rates on your behalf, as they would probably use a batch process to send out applications to multiple financial institutions all at once. Yes, and a bit unusual - CALVERT TOYO (your dealer) pulled your report twice on the same day. Presumably they are not getting any new information on the second pull. Maybe a fat finger? Regardless, you should not worry about this too much (to be explained below). I would say ""don't bother"". The idea behind hard inquiries lowering credit score is that lenders see the number of hard inquiries as your desire for credit. Too high a number is often viewed as either ""desperate for credit"" or ""unable to qualify for credit"".  But as explained above, it is very common for a person to request quotes for multiple financial institutions and thus to have multiple hard inquiries in a short period of time when shopping for loans. To account for that, the credit bureau's model would usually combine hard inquiries for a same type of loan (auto, mortgage, etc.) within 30 days. Hence a person sending quote request to 3 banks won't be rated higher for credit than if he were to request quotes from 5 banks.  Therefore in your case your credit profile is not going to be different if you had been pulled just once. my credit score goes down for 15 points I'm assuming you are talking about the credit score provided by Credit Karma. The score CK provided is FAKO. The score lenders care about is FICO. They are well correlated but still different. Google these two terms and you should be able to figure out the difference quickly. You can also refer to my answer to a different question here: Equifax credit score discrepancy in 1 month, why?" Each goes to a different agency. Yes, it is normal that the lender queries more than one agency. This is normal with the dealer's financing.  To add more details to littleadv's answer, what happens is when you get the financing through the dealer, at first, they will try to do the loan on your behalf with local banks in your area. This is why you see several hard inquiries; one from each back. If none of these banks wants to take the loan, then dealer's financing entity will take the loan. This was my exact experience with Hyundai. In addition, don't get surprise if you start receiving letters saying that your loan was rejected. The dealer will send the loan requests simultaneously, and some of the banks might deny the loan. This also happened to me, and I have been owning my car for around a year. Still, make sure that the letters matches with the credit inquiries.
If it costs more to fix the car than the car is worth, then those repairs are not worth it.  Hit craigslist and look for another junker that runs, but is in your cash price range.  Pay to get it looked at by a mechanic as a condition of sale.  Use consumer reports to try and find a good model. Somebody in your position does not need a $15K car.  You need a series of $2K or $4K cars that you will replace more often, but pay cash for.  Car buying, especially from a dealer financed, place isn't how I would recommend building your credit back up. EDIT in response to your updates: Build your credit the smart way, by not paying interest charges.  Use your lower limit card, and annually apply for more credit, which you use and pay off each and every month.  Borrowing is not going to help you.  Just because you can afford to make payments, doesn't automatically make payments a wise decision.  You have to examine the value of the loan, not what the payments are.  Shop for a good price, shop for a good rate, then purchase.  The amount you can pay every month should only be a factor than can kill the deal, not allow it. Pay cash for your vehicle until you can qualify for a low cost loan from a credit union or a bank.  It is a waste of money and time to pay a penalty interest rate because you want to build your credit.  Time is what will heal your credit score. If you really must borrow for the purchase, you must secure a loan prior to shopping for a car.  Visit a few credit unions and get pre-qualified.  Once you have a pre-approved loan in place, you can let the deal try and beat your loan for a better deal.  Don't make the mistake of letting the dealer do all the financing first. "Assuming I don't need any other new lines of credit, can I get pre-qualified repeatedly (and with different banks) with impunity? Yes, but only for a limited period. FICO says: Hard inquiries are inquiries where a potential lender is reviewing your credit because you've applied for credit with them. These include credit checks when you've applied for an auto loan, mortgage or credit card. Each of these types of credit checks count as a single inquiry. One exception occurs when you are ""rate shopping"". That's a smart thing to do, and your FICO score considers all inquiries within a 45 period for a mortgage, an auto loan or a student loan as a single inquiry. However for your situation, since you won't be getting a loan for several months, getting inquiries more than 45 days apart will each count as a separate inquiry." The dealership is getting a kickback for having you use a particular bank to finance through. The bank assumes you will take the full term of the loan to pay back, and will hopefully be a repeat customer. This tactic isn't new, and although it maybe doesn't make sense to you, the consumer, in the long run it benefits the bank and the dealership. (They wouldn't do it otherwise. These guys have a lot of smart people running #s for them). Be sure to read the specifics of the loan contract. There may be a penalty for paying it off early. Most customers won't be able to pay that much in cash, so the bank makes a deal with the dealership to send clients their way. They will lose money on a small percentage of clients, but make more off of the rest of the clients. If there's no penalty for paying it off early, you may just want to take the financing offer and pay it off ASAP. If you truly can only finance $2500 for 6 mos, and get the full discount, then that might work as well. The bank had to set a minimum for the dealership in order to qualify as a loan that earns the discount. Sounds like that's it. Bonus Info: Here's a screenshot of Kelley Blue Book for that car. Car dealers get me riled up, always have, always will, so I like doing this kind of research for people to make sure they get the right price. Fair price range is $27,578 - $28,551. First time car buyers are a dealers dream come true. Don't let them beat you down!  And here's more specific data about the Florida area relating to recent purchases: "The problem is not the credit score; it is the ""competing"" inquiries. Multiple inquiries will be considered as one if done withing a short time period (2 month, IIRC) and for the same kind of credit, because people do shop for rates, you're not the first one to do that. So don't worry about that. What you should be worrying about is banks asking questions about these inquiries, which is an annoying (at least for me) technicality. You'll have to explain to each of the banks that you want a pre-approval from that you're going to take the mortgage from them, and not from anyone else. In writing, with your signature notarized. Which is OK because it's done (the signature and notarizing) at closing, but you'll have to ""convince"" them that they're the chosen ones to get approved. Other than that it's pretty simple. I've done that (including the declaration that I'm not going to take any loans based on the other ""competing"" inquiries), and it worked fine when I took the original mortgage, and when I refinanced it later in a similar ""shopping"" fashion. Do it closer to the actual bidding, because closing does take at least 3-4 weeks, and the rate lock is usually for 30-60 days, so not much time to shop if you take that road." "So there are a few angles to this.   The previous answers are correct in saying that cash is different than financing and, therefore, the dealer can rescind the offer.  As for financing, the bank or finance company can give the dealership a ""kickback"" or charge a ""fee"" based on the customer's credit score.   So everyone saying that the dealers want you to finance....well yes, so long as you have good credit.  The dealership will make the most money off of someone with good credit.  The bank charges a fee to the dealership for the loan to a customer with bad credit. Use that tactic with good credit...no problem.  Use that tactic with bad credit.....problem." Yes, you are correct to go to the credit union first. Get approved for a loan first. Often, upon approval, the credit union will give you a blank check good for any amount up to the limit of the loan. When you buy the car, make it payable to the dealer, write in the amount and sign it. Enjoy the new car! "I'm impressed.  She must have a substantial income to agree to a $500/month car payment.  I imagine her income is about 20K per month for that to make sense.  What kind of work does she do?  To answer your question, typical lease do not work the way you describe.  Paying an extra $2000 will allow you to skip 4 payments (provided the payments were exactly $500) any time in the future.  It does not modify the terms of the lease which would include the payment amount.  Also one does not receive a fiance charge reduction benefit as with a loan.  Essentially you are providing a loan to the leasing company for free. To be explicit you cannot tell the mortgage company anything as she is applying for the loan, not you.  She can tell the mortgage company the new payment is $400, but she would be falsifying the application which is not advisable. Perhaps the mortgage company is doing her a favor.  They are indicating her life is out of control financially.  Either she is attempting to purchase way to much home or her consumer debt is out of control.  It could be a combination of both.   My first paragraph was written to be ""tongue in check"" in order to demonstrate absurdity.  Without a substantial income and an substantial net worth, a 500/month car payment is simply ridiculous.  While it is someone average, when you compare it to the average income (~54K/year) you understand why 78% of US households live paycheck-to-paycheck (are broke), and have no retirement savings. For your and her sake, please stop giving all your hard earned money to banks." I have to second what the poster said above me. The person at the dealership is outright lying to you, and I really don't know where the misconception comes from. I work in finance and specialize in credit. Credit is your ability to repay. Simple as that. To lenders, constant carrying a balance on your credit cards looks like your don't have the ability/discipline to repay your debt and will look bad in the future if you are ever trying to borrow more.