I’m about to close on a lease for a BMW with a local dealer and was hoping to use the BMW College Graduate Credit as my son recently graduated from an accredited undergraduate college and I added him as a co-applicant on the lease.
BMWFS came back stating my son does not have a credit history even though his credit score is 780+ on all three reporting agencies and his credit history dates back for multiple years. However, he has not had a credit card opened under his name directly, but has had multiple utility bills and leases under his name that have never been delinquent. Any advice on how I could handle this situation?
He has never borrowed money and so he doesn’t have a history of paying back borrowed money. The best thing for college students is to funnel expenses through the college cards so you can buy a car after you graduate or get a mortgage. I’m assuming the credit you are referring to is college housing which is different from borrowing money (or a car) and paying for it. Credit cards establish income and ability to pay off debt as well.
Thanks Parth, I appreciate your recommendation and in fact my son just applied for a student credit card to start building his credit history. However, that is not going to help us obtain the BMW College Graduate Credit now.
Can anyone think about a way to explain to BMWFS that they would not be incurring additional risk in this transaction as my son is being added as a co-applicant in the lease and I have a robust credit history and I’ve been a lessee from BMWFS for the last six years.
Has anyone run into this situation? Any additional thoughts?
Dealers I’ve worked with are fine with a college grad with limited credit if they can produce paystubs and/or an offer letter IF they have a co-signer with strong credit. YMMV though.
Assuming you satisfied the other requirements for the college grad credit, it seems that BMWFS has concluded that the credit history is insufficient. If BMWFS says no, then that’s the end of that. They are the final word on this unfortunately. They are predisposed to not give a free grand away and they will use any basis to reject the college grad rebate.
My experience is to pressure the finance person at the dealership. Depending on how bad you want to get this deal done, you may play cards with the dealership saying you won’t sign without the College Graduate credit.
My issue with College Graduate credit was the way they calculated income-to-debt ratio. My finance person was nice enough to try with three different agents from BMWFS and finally someone came to sense and finance the lease, but it was a lot back and forth. We had to go back to re-sign the lease.
I don’t understand why BMWFS always turns into “FBI mode” when it comes to College Graduate credit, but at the end of the day, it’s BMWFS’s money and it’s their call.
I would understand if the recent college applicant was the sole lessee, but in our case, I will be the primary signer with my son, the recent college graduate, as the co-signer, so very low risk for BMWFS not to mention that we are planning to do max MSDs.
I will call BMWFS next week and see if I can work something out. I will also talk to my CA to see if they can help. For now, the deal in on hold.
He’s been in my credit card accounts for years, and has had utility bills and rental agreements under his name, so that’s why I’m puzzled by the initial rejection.
Doesn’t make sense. If this is a joint application than there should be no reason for bmwfs to reject unless your credit is messed up.
Ask dealer that you would like to speak to BMWFS and inquire with them directly.
One last thing. Maybe have him as primary and you as co-applicant. I think they may be denying because you are the primary applicant and just adding son to take benefit of his recent grad.
Good point on the order of assignment. I’ll try that with my CA and BMWFS. We both have fairly good credit scores. Mine ~820, my son’s ~780, so it really doesn’t make sense…
Also, I would understand if BMW required single applicants to take advantage of the college graduate credit, but they don’t, so what gives…
You cannot have a credit score without a credit history.
Utility bills generally don’t report unless they charge off and a collection agency gets the account, and then the collection agency (and not the utility) is the trade line listed on the credit report.
What kind of leases? Apartment lease history generally doesn’t report either.
No late reporting on any credit line and multiple accounts have years of activity. The challenge may be that he was not the main account holder on them.
My son received an employment offer recently. I will provide that to BMWFS and see if that helps.
FICO only needs one trade line (account) with a minimum of six months’ history to generate a score.
Users of consumer credit reports build all sorts of business rules around the data contained in a report.
In this case, it would appear that a human or a computer at BMWFS has decided that an account doesn’t matter if the consumer doesn’t have primary responsibility for repayment.
I would ask some detailed questions with this in mind to confirm.
