The Verdict
CarMax offers a convenient way to buy and sell a car if you're not willing to do extra work to score a better deal
With its extensive digital catalog of cars and brick-and-mortar locations, CarMax has created an empire for the easy purchase and sale of used cars.
In many ways, and thanks to its no-haggle price policy and process of car certification, CarMax has delivered on the promise that inspired its creation: to make the used car market more clean and transparent.
If you're looking to get the best possible deal out of a purchase or selling your car i.e. more money, then you may want to consider another service (or even buying or selling it directly on your own) that lets each party negotiate for a price they think is best.
At CarMax, in exchange for a no-hassle process, you take what they give.
Why You Should Consider This Company
Use CarMax if you don't want the hassle of buying or the hustle of selling a car
CarMax is the largest retailer of used cars in the United States, with an extensive digital inventory and 190 physical locations in 39 states.
These physical locations create a unique combination of offline and online inventory, setting CarMax apart—offering both a physical and online way (at a national level)— from its competitors.
The company was created in 1993 by electronics retailer Circuit City with the promise of offering low, no-haggle prices, a wide range of quality certified vehicles, and superior customer service.
In fact, the car buying process at CarMax is designed after a consumer survey the company performed in 1991, while it was a secret project of Circuit City.
The main takeaways from the study were:
- Customers don't like playing games.
- They don't like wasting time when buying a car.
- They want security when buying a used car.
- They wanted to feel less pressure from salespeople.
If that appeals to you (it does to us!), then you're a good customer for CarMax.
You walk in, see what you want, buy it for the listed price, and walk out.
Alternatively, if you see a price they'll pay for a car you want to sell, then you can show up and command that price.
If you're prepared to hustle or shop around, you could score a better deal, which is what holds CarMax back.
Many people fear missing out (FOMO) and will go the extra mile to get the biggest bang for their buck, even if that time costs them.
Why People Love This Company
CarMax believes that haggling for a car turns people off from buying (and selling)
The company has built an empire by allowing its customers walk into their lots and sell their cars as easily (and painlessly) as possible.
The price-is-as-you-see-it policy significantly reduces the frustration of buying and selling in the second-hand automobile market, according to fans.
They will buy your car, no matter its condition. No matter how old, even if it's not in top shape, CarMax will offer you money for it.
Transparent process. The most-common selling point of CarMax is that it offers a transparent process to purchase a car with no bargaining or hidden costs.
Recent and certified cars. Most cars in CarMax's inventory range from one to six years old and have undergone an inspection and refurbishing process, which some customers claim gives them a "like new" feel.
More than 45,000 certified used cars for sale. The size of CarMax's inventory is hard to beat, plus all of its cars come with quality certification, a free vehicle history, a five-day money-back guarantee, and a 30-day limited warranty.
Multiple financing solutions. CarMax gives you a range of financing options through its own financial division or third parties, which makes it a good option for all types of buyers, even those with bad credit.
Five-day free return policy. If you have second thoughts, you can return your vehicle at no cost within five days of having purchased.
You can schedule a free appraisal and they will make you an offer that is valid for seven days at any of their locations.
Biggest Consumer Complaints
Make sure you do your due diligence before buying your car
CarMax's policies and somewhat rigid pricing model can be an obstacle to some customers who feel they deserve more for their car or who bought a car only to regret it later.
The no-haggle price system can mean you get less than you think you deserve. Some customers complain that not being able to negotiate a price is actually a disadvantage.
As a matter of fact, many claim that you can find better prices at other dealerships, including those of the car's own maker.
Short return period. Even though the five-day free return policy seems enticing at first, customers and experts note that buyer's remorse usually happens about a month after purchasing a car, which can make this feature feel less valuable.
30-days of free warranty isn't enough. Some buyers complain that it's too short a period of time for some defects to show, which in turn forces you to buy one of the extended warranties.
Note: The warranty is actually longer in some states:
60 days for Connecticut, Minnesota and Rhode Island, and 90 days for Massachusetts, New Jersey, and New York.
The Competition
CarMax competes with other large online car retailers, such as Cars.com, TRUECar, and Carvana
Due to its size and network of physical dealerships, CarMax has no direct peer in the used car market.
However, other car sellers or trading sites offer other advantages that you may want to consider before going with CarMax:
Cars.com and TRUECar offer new and used vehicles. If you're not completely sure that you want a used car, these other portals offer new cars in their inventory, which gives you a more robust array of choices before you purchase.
Autotrader claims to have a much larger inventory. While it doesn't own the cars it sells like CarMax, this online-only retailer claims to be the only website with more than three million vehicle listings from 40,000 dealers and 250,000 private owners.
Carvana offers a full-online experience and car delivery to your door. If you feel confident to trust a full-online experience, which involves virtual inspection of your car and no test drive before you commit, you may want to consider Carvana, which is currently expanding its network of local markets.
Peer-to-peer intermediaries like CarLotz allow you to play a more active role. If you're interested in taking part in the sale in order to get the best possible price out of your vehicle, you should consider a service such as CarLotz (though it's only located in Virginia and North Carolina).
They'll help you with prepping your car for sale and listing it.
The Question Everyone is Asking Now
"Can you negotiate with CarMax?"
One of the main benefits of CarMax is their pricing transparency, which in turn doesn't allow too much flexibility and restricts your ability to negotiate.
Part of the appeal of CarMax it that it sells cars on a no-haggle pricing system.
A better question is: does this non-negotiable model get you a better deal?
The answer to that question is harder to answer.
The short one is: probably not.
You're paying them to take away all the hassle you'd go through figuring out how much your car is worth and getting someone to buy it for that price.
In exchange for that convenience, you're getting a lower price than if you did it yourself.
You probably could get a better deal if you did all the legwork and hustle yourself.
Before you jump in, consider how much time it will take to do that.
How the Company Works
You'll start online, but you'll end up going to one of their lots either to buy or sell a car
Even though the inventory technically spans all their lots, the business still revolves strongly around how close one of those 190 dealerships is to you.
If you're selling, they're buying. As mentioned, CarMax will buy your car no matter how old or the condition it is in.
You can schedule a free appraisal online (or simply bring your car to any of their locations) that could take "as little as 30 minutes," after which they will make you an offer that is good for 7 days at any CarMax location.
If you're buying, start online. Why? Because one of the great features of CarMax is that it can transfer cars between locations (sometimes for a low fee), so their inventory is actually much bigger than the cars they physically have at your nearest location.
You have to purchase offline at a CarMax lot. Once you've found a car you're interested in, you can use CarMax's website to put a freehold on it until your scheduled appointment, get information on how to finance its purchase, or request a transfer (if the vehicle is in a different location).
You cannot complete the car-transaction online, but you can get started and then close the deal with a sales consultant at your nearest store.
They offer financing and extended care
CarMax promises to approve the financing of most of its customers in 20 minutes or less.
Need cash to buy your new baby?
CarMax Auto Finance and external finance companies are lined up to help you get that financing.
You have three days to get a better deal. If you find more affordable financing elsewhere, you can cancel your financing from CarMax (penalty-free) within three business days.
Extended protection through the MaxCare Service Plans. The 30-day limited warranty included with all car purchases doesn't amount to much.
You can buy extra protection plans that cover most parts of your vehicle and fold it into your monthly payments, if helpful.
Key Digital Services
CarMax's app mirrors its website and allows you to easily browse, buy, and sell cars from your phone
While the app has most of the features found on the website, it doesn't showcase the CarMax Car Payment and Fuel Savings Calculator popular on the site.
These calculators allow you to see what you'll spend on your "new" car in terms of monthly payments and in fuel.
Helpful for those of us on a budget!
Users love the app. 85% of those who rated it in the Google Play store gave it 4 of 5 stars. Comments like "make car shopping a breeze" are common.
FAQ
What kind of quality can I expect from a car bought at CarMax?
CarMax has a reputation for inspecting and refurbishing the cars it sells, putting them up to their "CarMax Quality Certified" standard.
The company claims to spend an average of 12 hours renewing each car they put up for sale.
Are there any physical locations to visit?
Yes. CarMax currently operates 190 physical stores in 39 states.
Can you return or exchange a car after you purchased it?
CarMax offers a five-day free return, no-questions-asked policy on any car it sells.
What are the customer reviews about their experience with CarMax?
There are mixed reviews online. Many reviews left at the company's website show happy customers, while those found at sites like Consumer Affairs include complaints about the quality of the cars sold, the way the extended warranties work, and the customer service.
Are CarMax's services free?
The appraisal for your car and putting a hold on a car you're interested in purchasing is free.
Transferring a car between CarMax locations may be free or cost you a fee. Reach out to the nearest location for specific info on your case.
How do I contact CarMax?
Through their website, or by calling their headquarters (1-800-519-1511) or calling your nearest store.
Do sellers and buyers get vetted by CarMax?
CarMax vets the cars it buys and sells, not the sellers and purchasers. It will run a credit score check if you are looking for financing.
How legitimate and safe is it to use CarMax?
CarMax offers a safe car buying and selling experience.
It is an established and respected company, which makes buying or selling a car a safe financial and legal experience.
Are there physical branches available?
Yes.
CarMax has 190 stores in 39 states.
Is CarMax available nationwide?
Only in 39 states.
Can I write a review on my experience with CarMax on their website?
Yes, although the reviews are linked to car models, not to the general service of CarMax.
I have submitted my request to purchase. Am I now obliged to purchase the car?
No.
You are not obliged to purchase.
How does CarMax help me if a purchase deal falls through due to false information?
CarMax doesn't have a specific answer to this question.
However, CarMax's quality inspection process reduces the risk of false information regarding their cars.
Do they offer auto insurance too?
No, CarMax doesn't sell auto insurance. You must obtain it from a third party.
I have really bad credit. Can I still apply for the financing option?
Yes, you can still apply, but a bad credit score will probably mean bad financing conditions if the loan is approved.
CarMax promises to be able to provide "options to customers with many different credit profiles" because of its association with third-party financial institutions.
Who approves my auto loan and how can I make payments?
CarMax offers financing through its own service, CarMax Auto Finance, while also having relationships with third-party financing institutions, including Wells Fargo, Santander, Capital One, and Westlake.
Do they offer rewards program or discounts on their products?
No.
Can I use a coupon to get a deal on the product?
CarMax doesn't offer coupons.
However, its terms of service state that "[r]ebates, customer cash, dealer cash, coupon offers, and other incentives provided by vehicle manufacturers are subject to the terms specified by the manufacturer."
How much does CarMax take if I sell my car via their portal?
CarMax doesn't act as an intermediary.
They will appraise your car and make you an offer that will then be valid for seven days.
What is included in the MaxCare service plans?
The MaxCare extended service plans cover almost all parts of the car (engine, transmission, drivetrain, electronics, electrical systems, steering, suspension, cooling system, and climate control).
They also include rental reimbursement for when the vehicle is inoperable (up to $40 per day for seven days) and emergency roadside assistance (services are covered up to $100 per occurrence).
The plans don't cover maintenance services and parts such as batteries, trim, wiper blades, and wheels; aftermarket accessories or equipment installed after purchase date; breakdown caused by abuse or misuse; tire replacements.
CarMax will make your used car buying and selling experience an easy but rigid one
While Circuit City may be long gone, the idea they nurtured that resulted in CarMax is paying off for many a car buyer.
Built on the promise that you shouldn't feel hustled or haggled when selling or buying a car, CarMax has spread across the States.
If you're looking for an easy way to find a "new" ride or sell an old one, then they are definitely worth checking out.
Have you bought or sold a car with CarMax?
How did it go?
Would you do it again?
Let us know in the comments below