The below is general information only. The information is not legal advice, and should not be treated as such and is subject to the legal disclaimer.
According to a Consumer Report investigation, car dealers do not have to your social security number in order to pull your credit report. Rather, they can use your driver’s license to obtain a copy of your credit report. And if you’ve ever been shopping for a car at dealership, you know that dealers will get a copy of your license before letting you take a car for a test drive. The dealer may use the information on your license to pull a copy of your credit report. And the dealer might not ask for your permission to do so. This raises an interesting question of whether this violates the Fair Credit Reporting Act.
Based on FTC opinion letter, this may well come to down to question of fact. According the FTC, “an automobile dealer may obtain a report only in those circumstances in which the consumer clearly understands that he or she is initiating the purchase or lease of a vehicle and the seller has a legitimate business need for the consumer report information in order to complete the transaction.” This opinion is based on the assumption that the car dealer is using 15 U.S.C. 1681b(3)(F)(1)[1] as its permissible purpose for pulling your credit report.
So if you don’t want a car dealer pulling your credit report when you take a test drive, you may want to expressly tell the dealer not to pull your report, just to protect yourself.
[1] “[A]ny consumer reporting agency may furnish a consumer report under the following circumstances and no other . . . [t]o a person which it has reason to believe . . . otherwise has a legitimate business need for the information–(i) in connection with a business transaction that is initiated by the consumer.”
