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Occasional Contributor

 

Friends,

 

I was humbled the other day by an experience I had while purchasing a new auto. I found the right car at the right price and had completed almost all the pre-work before going for the test drive to seal the deal. The day was going very well and I was simply surprised by the professionalism, integrity and honesty of the dealership. Well, that's for another letter.

 

I was feeling pretty good until I called USAA to secure a loan. I am a 32+ retired military member and my wife and I have been members of USAA for 33 years. I must say that USAA has been our trusted rock where we would always turn for all things financial. Then, it happenned ... USAA denied me for a $12,000 auto loan. Their reason was simply related to a credit language obtained from Experian and not even a "Credit score" (which has always been excellent). Experian reported that we did not have enough revolving credit (we pay our cards off each month and have few) and that we did not have enough revolving mortgage evidence/interest (we worked hard to outright own our home). 

 

That was my first lesson on humility that day, but it was not my last. I learned that no matter how hard you work to position yourself financially it may not protect your integrity from being in question from an outside source (Experian). The second humility lesson was one that conflicted with my lifelong belief in USAA. Once denied by a first-line loan agent I asked to speak with a supervisor (Joanie) whom I hoped would be able to peek at my financial position (investments, savings, etc.) and provide an overide of sorts. To my surprise, I was metaphorically punched in the gut again with a second denial by Joanie. She said, "Sorry, there is nothing we can do; we follow loan protocols." She followed up by saying we might be able to get a loan from the car dealer. What!!?? She was nice about it, but it sure seemed like my loyalty to USAA might be a one way relationship. Joanie mentioned that it was the policy of the bank CEO.  On her integrity I asked her to have him/her (or a representative) call me.  That did not happen so here I am putting it out there to the community.

 

There are a lot of lessons for me from the day I went to buy a car. The car dealer hit homeruns, but USAA was definitely lacking. Stay in debt was a message from Experian that I still do not understand. USAA's message that, "We do not trust your evidence of fiscal responsibility and loyalty demonstrated for 33 years with us" makes my head spin. The lack of effort of the senior loan officer to find a way is a thought that also lingers with me.

 

In the end I did get a loan from the car dealer. He had the same information USAA had, but read the credit report. Although the credit report did not produce a credit number, it had evidence of three separate mortgages, multiple car purchases, multiple credit cards in history and never a payment missed. The car dealer treated me like I had a 33 year relationship with him. USAA missed the boat on this one and might want to learn from this one too. USAA failed to look at me like a valued and loyal member who they want to be part of their organization. They simply did not do the homework at their fingertips that would have revealed my financial resources and responsibility. Individual relationships matter and looking beyond the protocol process might be smart if you are trying to demonstrate it. I'm still waiting for that call from USAA...

4 REPLIES

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Hi there @klater.  I am sorry for the experience you received with us while car shopping.  I am going to have this looked into and further reviewed.  We appreciate you taking time to let us know what happened. 

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I have a similar experience.  About 2 1/2 years ago, I attempted to get pre-approved for a home loan.  I was immediately denied.  When I called for more information, the agent told me that my credit report was the problem.  I inquired about paying 20% down.  Still declined.  I inquired about 50% down.  I was still declined.  The loan had nothing to do with me.  It had everything to do with my credit score.

 

To provide some context, let me explain the reasons why I think I should have qualified.  I had worked in the lending industry for many years and understand the "5 C's of Credit."  They are:  Character, Credit, Collateral, Capacity, and Character.  After seeing the devastating misuse of credit had caused my customers, I decided that that would never happen to me.  I closed all of my accounts, paid them off, and saved as much as I could.  It was not easy, but hard work paid off.

 

Now, here I am.  I have had an account with USAA for about 15 years.  I have $$ in accounts with USAA.  My credit file shows no delinquency.  Everything was paid off long ago.  I have been employed with the government for about 20 years.  How is it possible that I was denied a loan??  I'll tell you why.  USAA does not value a relationship.  A reasonable person does not actually look at the application.  A computer generates a score, and that's that.  It is truly sad state of affairs when a score outways the actual "5 C's of Credit."

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I forgot to mention Experian.  Today, I requested my credit file from the 3 big agencies.  Guess which one could not give me my file online, but was cited as a source from USAA?

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Unfortunately, the reason they mentioned (not enough credit) is the only response you're going to get from USAA. Seems they no longer relu on a human being to make a decision whether they will risk giving anyone a loan. Seems the credit score is the only thing they look at these days, but even those with very high FICO scores (in the 800s) get turned down. Why put the spotlight on your financial institution's inability to make a commitment to you when you can blame someone else (Experian) for the problem. 😕