So, this is really weird, and kind of freaking out a little bit here. When I had definitely decided on getting another MINI (early December 2008), I co-applied with my mom for financing through MINI financial. We got approved and everything with a decent interest rate and whatnot, and we were satisfied.

So the car comes in on New Year's Eve and we go pick it up, run everything through the finance guy (everything is still good), sign the paper work, and leave happy. Well today we got a letter from MINI Financial Services stating that we were turned down for financing. WTF?!?!?! What does that even mean??? I'm so incredibly confused right now, and have no idea what's going on.

I was going to go register my car on Monday and now I have to wait and see what the hell is happening with this. Anyone else have any issues or know what might be going on. I'm kind of wiggin' out right now!

 

im thinking there going to ask for the car back !!??
If so you should have as much fun with it as possible till then !

 

Yeah, that's not going to happen. We definitely have other options for financing, this was just preferred.

I just want to know why we were approved TWICE at the dealer and we're getting rejection letters. It just makes no sense.

 

It could simply be a mistake. I wouldn't sweat too much until you talk to the dealer on Monday. They should be able to give you the straight scoop fairly quickly.

Did you get an approval letter or something else that told you you had been approved beside's just the dealer telling you?

Again, don't know that you can do much until MINI is open on Monday and you can get feedback.

I hope it works out for you!!

Pat

 

Thanks, Pat. No, we hadn't gotten approval letters, just feedback from the dealer. Hopefully, it's just a mistake. I guess Monday we'll find out.

 

I think you are right.

I'm happy that you have back up financing available.

Pat

 

Sounds like a huge mistake. They would not have given you a $26K MINI if you weren't approved.

Have fun and relax

 

Seems really bizarre that the dealer would even let you off the lot if your financing wasn't 100% sure thing? I know this sounds like a silly question, but are you positive that you actually financed with MINI? (Please don't take this as me thinking you are stupid... that's certainly not it.)

The reason I ask is because initially, we thought we would be going through MINI (same as you) but for some reason the finance guy ended up getting the loan for us from Bank of America. Wachovia had called us asking if we were applying for credit for a car purchase (since we were in a different state)... so we thought it would be MINI first, then Wachovia, but it ended up being Bank of America. Apparently Bank of America had the best rates or something.

So maybe MINI had different, less desireable underwriting guidelines or debt to income ratio requirements that you didn't qualify for or maybe the dealership finance person got a better rate with some other place? The only other thing I could think of that could happen (happens very often with lenders when people get approved to buy houses) is if you went out and purchased other things like furniture or electronics or something that increased your debt load after approval or before delivery of your car. But still.. I can't imagine that the dealership would let you off the lot. Just a guess... hope it works out. And like the other person said... have a blast while you have it!

It'll be interesting to find out what happened.

 

Thanks, for all the reassurances guys. It's really making me calm down quite a bit.

Miniola,
We did MINI Select (since we should have the balloon payment when it's due), so I don't think they went through another financial service. Also, all the paper work said "MINI Financial Services" all over it.

As far increasing my debt load... I put another $200ish on my credit card (for Christmas stuff). But that was two weeks prior to picking up the car, and surely going "into debt" another $200 wouldn't make that kind of difference. And my parents don't usually use credit cards at all.

The more I'm thinking about it, the more it sounds like it's just some kind of mistake. I agree with you guys that it doesn't make sense for them to let me off the lot if we weren't definitely approved. I guess we'll see on Monday.

 

Ahh... MINI Select... yup... think you have to go through MINI for that one! That's the program we used for our first one. I wouldn't think the $200- ish would make a difference at all. Before you picked it up, did they say anything about you needing to put more money down or anything? If so, maybe that letter was just delayed from earlier. I guess one thing of comfort for you while you wait... if they want it back... they'll have to catch you first!!
Repo man... whatever... HA! Good luck. Good night.

 

Actually, I just thought of something... I made a sale on eBay back around the same time and was trying to work out a refund for an item. The guy wound up doing a chargeback setting my Paypal balance in the negative about $850. (FYI - everything worked out fine, got the item back safe and sound and whatnot.) Anyway the account went negative about week after I got the car, but has since been resolved. Do you think this could have caused it?

I still don't think that it would have affected my mom's application though would it?

 

No. We didn't have to put anything down, though we put like $1700 down on it.

Thanks for the calming words!

 

Okay... so the only other thing I can think of is this...

When I got my first MINI, they ran the financing about ten different ways (i.e., me by myself, me with my dad as cosigner, my dad with me as cosigner, and so on...). I was thinking... what if they ran the financing backwards just to see, like they did before? (i.e., me with my mom as cosigner, instead of vice versa) Would that do anything like this? I mean, my credit is pretty good, I just don't have enough to get this kind of loan on my own (thus, why my name is on the paper work this time). Any thoughts?

 

I was thinking the same thing. I remember applying for the MINI credit card and they sent me a rejection letter...maybe this is the same thing? They tried to apply for credit using only your name and then it got rejected and they send you a letter as to why your rejected?

I'm pretty sure it's a fluke.

 

I wouldn't worry to much about it. In Florida if you leave a dealer with the car, the amount of your payment and terms. It's a done deal. If the dealer can't get you financed the dealer becomes your lien holder and you make your monthly payment to the dealer. Check your state guidelines with the dept of motor vehicle, or title agency. Now as your dealer is trying to get your paper sold. your credit report score is going further down each time your credit report is run. There are dealer tricks than border on deceptive practices. but I'm sure your BMW/MINI Dealer is on top of it. Call the Finance Dept. on Monday and verify your lienholder, rate & terms. I'm sure it will all work out. Happy Motoring - Mark

 

Sounds like the Decline letter was from before they got an approval... maybe it is from when they first ran it just with you on the loan before they added the co-signer. The Decline letters automatically get sent out about 30 days later, even if you were approved on a different application number.

 

I used Mini Select to finance my Mini too. You mentioned you have the paper work with Mini Financial Services all over it. I assume you had to sign it too, and it says what your Interest rate is, your monthly payment and when the balloon payment is due and how much it is. You should be good then as this is your finance contract already. Now move on to your next problem, how to break in your Mini as fast as you can. Congrats!

 

Thanks a lot guys. I really appreciate the responses here.

 

Big mistake... If the paperwork was signed and the dealer delivered the car to you, you were approved... Every car I've ever finance was approved before the dealer let me take it off the lot. Probably something their computer spat out in error. Stick to the signed agreements, delivery of the vehicle was consumation of the deal and leave it to the dealer to resolve.

PS: Remember if there is a problem and they want you to return the car they will be getting back a now USED car to resale and you can go buy a new one somewhere else. Leverage.

 

Paperwork in mail should be ignored, thrown away.

When you apply for loan, the financial officer of the dealership applies at several banks and institutions for your loan, and when they ALL come in, they give you the best deal offered/received. Not all of them come back approved.

You are likely to get more of these in the mail. Circular file them, and ENJOY THE RIDE...........

 

Normally, I would have thought the same thing, but we specifically wanted to do MINI Select, and all the paper work was definitely from MINI Financial Services, which is why this whole thing is so confusing. Thanks for helping to ease my mind a bit more, though. I really think that this has to be some kind of fluke. I would think that the dealer would have called us before we got letters if there really was a problem.

 

You don't have to be formally or even conditionally approved for the dealer to send you home in a new car, it's a roll of the dice for them based on their experience with their lenders and the information you supplied them. That said, I also would not worry about this letter - especially as you said you have other financing alternatives available. Just go enjoy your new car........

I have never heard about the dealer being on the hook in Florida, unless they "kissed the paper", in other words they garanteed the loan to the financial institution. Dealers are not banks, so unless you're talking about a "Buy here, Pay here" dealer, I don't think this is a state requirement. It'll be interesting to find out tho......

The difference is the BHPH dealers own their cars outright, they're not floored by a bank. Most if not all new car dealers do not own their cars, they have "flooring", a bank loans them the money to buy the cars from the MFR, and they pay monthly interest to the bank till the car is sold, at which time they pay off the bank. This is part of why the end of the month is a good time to buy, the monthy flooring is due, so the more cars they sell, the less they have to pay the bank in flooring.

 

That would make sense. The only thing is that when we originally filed the paper work it was on a Saturday (the car wasn't even "ordered" at this point. They told us they couldn't get an approval or anything until a weekday when MFS was open because they'd have to call it in and get approval based on the cost of the car. So, if they called it in an MFS approved us... I have no idea from this point. This is incredibly confusing, especially since we are better off financially than when we got the first one and the payments are LESS than they were on the last MINI.

I guess ultimately I'll have to wait and see what's going on tomorrow when the dealership is open.

 

Never knew there was a rule like this where the dealer becomes the lien holder. Interesting.

MoxieMini- As for the credit score going down each time the credit is run, from my understanding, this is not necessarily true. Of course there are varying opinions on this. Shopping rates within a specified period of time (say 30 days for example) for a specific item like a car or house doesn't necessarily drop your score. You said your credit is good so that's a plus. Now, if you were going out and applying for various credit cards and getting other loans, that can affect it, especially if your credit is "marginal".

Some tips that I've been given (was told that they would affect my credit score):
-if the consumer closes an account (like a credit card)- negative (although one would think that reducing "available credit" would be a positive... it isn't)
-if the consumer applies for credit at several places like Best Buy and Circuit City, furniture places, car dealerships, mortgages, "toys" (boats, motorcycles,etc) all around the same time-can be negative
-putting all credit card debt on one credit card instead of having it spread over more than one (resulting in low amount of available credit makes your ratio higher)- negative
-not sure when you're going to buy a house, but most lenders require that you have at least 2 revolving credit/trade line histories for a period of 24 months each (so when people buy a car and pay it off within less than 24 months, it's not counted)... credit is especially a problem when people pay cash for most things. Having no debt doesn't equate to good credit.

So although common sense would tell us that reducing our available credit and having just one card, asking a credit card company for less credit, paying off debts early or paying in cash would make our credit good... just doesn't seem to work that way. Credit scoring is a weird and wacky thing... and just when we think we've got it figured out we find that we don't. And I think they're going to start using some kind of new system sometime soon so... . Usually with credit scoring, your numbers are based on histories from a group of people in similar situations that you are in. I don't know how this will be affected with so many foreclosures and bankruptcies going on.

Anyway, I still think you are fine and it makes sense that they ran a bunch of scenarios for approval just like you said and you just happened to get a late letter.

PS- I hope you're out DRIVING and not stuck in that lab!

*Also, when we started out and were getting our first house, we had closed accounts, consolidated credit card debt to one card to lower our available credit, tried to pay things off as soon as possible and sometimes we would get those offers for credit in the stores (you know when they offer you like 10% off if you get a card with them today?)... well our scores were in the low 600's then. We didn't have any unpaid bills or late payments or anything. Last score I think I had was a 786... which reminds me... I should check that again.

 

If this does turn out to be a mistake, be sure that the declination letter doesn't end up on your credit report. Better check your file with the credit bureaus for the next 6 months or so to be sure.