Does Carvana Pay More Than Carmax?
Carvana vs. CarMax: Which Is Better?
These two large used car retailers are quite popular in the market in terms of buying, trading and selling used cars. If you do not want to transact with car salesmen, or you do not want all the hassle of selling to a private buyer, these two car retailers seem to do a great job in buying your used cars. Do they sound familiar? Here's a little introduction about these two large car retailers:
CarMax, founded in 1993, is America's largest used-car retailer and a Fortune 500 company. As of November 30, 2018, CarMax operated 195 locations and currently has 225 stores nationwide. A typical Carmax store usually has an inventory of 300–400 vehicles and goes through a thorough 125-point inspection process, a process that exceeds the state-required inspections. A good thing about Carmax is that they have a 90-day warranty, three days to change your financing, and a money-back guarantee. According to Wikipedia, CarMax was on Fortune's "100 Best Companies to Work For" list from 2005 to 2018, placing 34th in 2018. In 2020, Fortune ranked CarMax at number 20 on their Fortune List of the Top 100 Companies to Work For in 2020 based on an employee survey of satisfaction.
On the other hand, we have Carvana. Carvana is an online used car retailer that is known for its multi-story car vending machines, and in 2018 it was reported to be the fastest-growing used car dealer in the United States. They are the first end-to-end online vehicle retailer that allows customers to choose, finance and purchase more than 20,000 vehicles from their homes, while also offering the convenience of buying your car without ever needing to have a dealership. They also offer 150-point inspection to thoroughly check every essential part of the interior, exterior and engine compartment. According to Business Wire, Carvana is offering as-soon-as-next-day touchless home delivery to 100 additional cities across 24 states to provide those who need to purchase, trade-in, or sell a vehicle with an entirely online car buying experience with a great selection, great prices, and great customer service. Let's check out the benefits we can get from each of these car retailers and find out who is willing to pay more for your used vehicle.
Can I Sell My Car & Not Buy From Them?
CarMax: Yes.
Carvana: Yes.
How Do I Get an Offer?
CarMax: Due to the pandemic, some stores require you to set an appointment first, before you can visit them. You can call the closest store near you or you can schedule your time online to get an offer.
Carvana: You can conveniently get an offer through their website. They will ask you to enter the necessary information about your car like the Vehicle Identification Number (VIN), license plates, etc., and in about a few minutes, you will receive their offer.
What if the Offer expires?
CarMax: If the vehicle was appraised more than seven days ago, CarMax will re-appraise your car and provide an updated offer.
Carvana: You can submit your car details for re-appraisal in case the 7-day period expires.
Where Can I Sell My Car?
CarMax: If you got an appraisal online or from one of their stores, you can sell your car to any CarMax locations with the said written offer.
Carvana: There are two options for Carvana. You can bring your car to one of their offices/ vending machines or you can choose for them to come and pick up your car with their touchless delivery/pick up service.
What Happens During Appraisal?
CarMax: Does "low-touch" appraisal, they can make an offer without sitting in your vehicle or touching the most frequently-used areas. You can observe your car's appraisal but of course, social distancing is observed with your appraiser. They may ask you to assist in starting the car, opening the windows, doors, trunks, etc. They may also try the car for a test drive if you choose to sell. For trade-ins, they have "Contactless Curbside CarMax", in which you do not have to go inside their store for the transaction. You can get pre-approved online, get an offer, and upload the required documents. Then they will contact you to set an appointment to any of their CarMax curbside parking spaces. They will let you inspect the new car, test drive it solo and still maintain the 6 feet distance with the CarMax associate to do the paperwork. Curbside CarMax is only available in select locations.
Carvana: Does the "touch-less pick-up/ delivery" system. You do not have to bring your vehicle to their office as they will come to you. For selling or trade-ins, a Carvana associate will call you and ask you to park the used car where they can access them. Upon their arrival, they will leave the paperwork on the windshield and will call you to come out, take the paperwork, left the keys, and the title inside so they can take the vehicle for a test drive. They will also ask you to sign the paperwork while they take the car for a spin. Afterward, they will ask you to leave the paperwork on a secure spot so they can get them. Once they are back in the hauler, they will complete the purchase in their system and call you to say thanks. This is how their touchless delivery works.
How Do You Get Paid?
CarMax: Can pay you after appraising the car if in case you agreed with their offer. They pay with a bank draft that must be deposited and cannot be cashed. Before you attempt to draw on the bank draft, check with your bank to see if they have a specific hold policy on deposits. For trade-ins, you can apply any positive equity from your current car to the down payment on your next car.
Carvana: You will be paid by check on the spot as per the agreed amount or offer.
Warranty & Return Policies:
CarMax: Normally, CarMax only has a 90-day warranty or 4,000 miles. Due to the current situation, CarMax also provided an extension on the duration of its 90-day limited warranty. The extension went into effect on March 16, 2020, and applies to all cars purchased on or after December 17, 2019. This extended warranty ended on May 18, 2020. On a different note, you can invest in MaxCare® extended service plans to cover unexpected car repairs that can last for years. Other than warranties, they also have a 7-day return policy. If in case you did not like the car from the trade-in, you can have it returned and be refunded.
Carvana: Carvana has a 7-day return policy and a money-back guarantee. A Carvana warranty will have a complimentary limited warranty that is valid for 100 days or 4,189 miles from the time of your purchase, whichever comes first. They also have CarvanaCare plans for extended warranty. As of April 2020, Carvana is giving its customers 90 days for their first payment. This is in line with the current Covid-19 pandemic crisis as they want the customers that are in need of safe transportation to be able to avail of a vehicle.
Who Pays More?
CarMax determines its offer by reviewing the current market conditions as well as the car's information and vehicle history report. They also test drive your car, see if everything is working properly and if its in good shape. Their offer also depends if repairs are needed or how well you have highly maintained your car's condition. According to depaula.com, former CarMax employees reveal that CarMax does not retail cars with over 130,000 miles, and if the vehicle is low on demand. High-mileage vehicles will go to the wholesale auction, and CarMax generally makes very little on these. They also do not buy 10-year old cars and above.
Same like CarMax, Carvana's offer is also based on the current market situation. They also based the pricing on your car's history, condition, maintenance, and if there is a need for repairs so you will have to be honest in providing your car's condition online. Their prices are non-negotiable but seem in congruence with Kelley Blue Book prices for certified used cars in very good condition. Also, Carvana accepts some trade-ins in local markets.
So Carvana vs CarMax? Most of the customer reviews say that Carvana pays more than CarMax. Carvana invests in buying more used cars to widen their inventory so that customers will have a good selection of used cars to choose from. The growth in their existing markets was because of expanded inventory selection, enhanced marketing efforts, increased brand awareness and customer referrals helped drive the increase in units sold, according to Digital Commerce 360. CarMax, on the other hand, being in the industry for so long seems not troubled and still stands strong in the business. Customers entrust and sell their cars to them due to the convenience and simplified process of selling. Meanwhile, here are some Carvana reviews from dealerrater, reddit, and leasehackr:
Comparable to Carvana's style of buying used cars is "Sell My Car In Chicago With Enrique for Cash." They are one of the high paying car buyers in Chicago that makes the car selling process easier for you! You do not have to bring your vehicle to an office as they will come to you to make the inspection. All you have to do is to give them a call at (224) 236-7010 or sell a car online for a free quote. They will reach out and offer the best pricing suitable for your car. Once you agreed, they will let you sign some paperwork, and they will take care of your vehicle. Truly hassle-free and effortless. All in the comforts of your place.
