CarMax Review: Is It a Good Way To Buy a Car?
CarMax promises a low-stress, haggle-free car buying or selling experience.
With over 200 physical stores and the ability to shop online, CarMax is certainly an enticing option for used-car buying.
But do they really live up to all of the hype?
Table of Contents
- What is CarMax?
- Is CarMax Free?
- Can I Trust CarMax?
- How Does CarMax Work?
- What is CarMax Curbside?
- How Do I Buy a Car on CarMax?
- How Do I Sell a Car on CarMax?
- CarMax Policies
- Does CarMax Offer Financing?
- Does CarMax Check Your Credit Score?
- CarMax Review - The Good & The Bad
- What Are Alternatives to CarMax?
- Best Car Deals by Category
- Frequently Asked Questions
What is CarMax?
CarMax is a car retailer that sells both used and new cars. They have physical locations as well as an online store that you can browse. When shopping from CarMax, you can elect for curbside pickup or delivery. Since it also has physical stores, you may be able to visit a CarMax dealership to test-drive a car.
Is CarMax Free?
CarMax does not charge any fee to shop for used cars or to sell your car. However, there are still some fees you may have to pay when buying a car from them.
- Transfer Fee. If a car you are interested in is in another lot, you may have to pay a transfer fee. This typically applies if the vehicle is out of state, and the cost will vary based on the distance.
- Processing Fee. Like most dealers, some CarMax locations charge dealer fees for the paperwork. About 50% of CarMax locations charge the dealer fee, and it can range from $100 to $400.
- Delivery Fee. To have your vehicle delivered when purchasing online, you'll have to pay a delivery fee based on the distance.
Can I Trust CarMax?
CarMax is a legitimate company, but it is not accredited by the Better Business Burea. However, they have a 3-star rating for 2,935,162 verified overall customer satisfaction reviews on Consumer Affairs.
Common concerns include issues with the used vehicles, trouble getting the warranties, and low offers when trying to sell. On the same note, many customers have had excellent experiences buying and selling on CarMax.
How Does CarMax Work?
With CarMax, you can browse used and new cars for sale. All cars have set prices for them because the company has a “no-haggle” policy. Because CarMax also has physical locations, you can view the car in-person. However, they also offer home delivery or curbside pickup services.
What is CarMax Curbside?
CarMax offers contactless car-buying via Curbside. You can complete your necessary paperwork at home and then head to the nearest CarMax to test drive the vehicle. Curbside allows car buyers to adhere to social distancing practices while buying. It also saves time by allowing you to handle most of the process online.
How Do I Buy a Car on CarMax?
- Search for a Vehicle. Enter desired criteria for the keyword, model, or make. Add any filters based on price, year, or type to narrow the search.
- Compare Vehicles. CarMax has interactive 360-degree profiles. You can see the interior and obtain the VIN. Additionally, you get a free car history report from AutoCheck.
- Payment. Confirm cash payment or get pre-approval for financing.
- Trade-Ins. Get your trade-in offer online or schedule an appointment for an appraisal at a CarMax location.
- Delivery or Pickup. You can buy it online or have it shipped to a CarMax location for pickup. Some purchases also qualify for home delivery, and it will show up as an option on the listing. The other option is to schedule a test-drive at the vehicle's location and complete the purchase in-person.
How Do I Sell a Car on CarMax?
- Give Car Information. Use their form to enter the details about the vehicle. You'll need to input the make, model, mileage, and year.
- Inspection. If CarMax is interested in your vehicle, they will send a message to schedule an inspection.
- Go to CarMax Location. You must bring your vehicle to a CarMax location near you for inspection. Bring your title/payoff information as well as a state-issued ID. You will also need all of the car keys and fobs.
- Instant Offer. If the vehicle meets their criteria, CarMax will give you an instant cash offer that's good for up to 7 days. You do not need to buy a car from CarMax to sell yours.
Does CarMax Offer a Warranty?
CarMax provides a limited warranty. The warranty covers the vehicle's major systems (transmission, electronics, engine, drivetrain, electrical, steering, cooling, climate control, suspension) for 90 days or up to 4,000 miles.
Is CarMax MaxCare Worth It?
CarMax MaxCare is the brand’s extended warranty. MaxCare covers the core components of your car, also anything in the manufacturer’s maintenance schedule. Your deductible will be between $100-$500 per repair, and your payment for the plan is between $1,000 and $8,500, depending on the vehicle.
You can only sign up for the MaxCare plan when purchasing your vehicle. MaxCare claims are not handled directly by CarMax; instead, they will go through one of their partners. The plan will not cover any repairs without prior authorization, and it also does not cover the exhaust system or catalytic converter.
Whether or not MaxCare is worth it depends on the cost of your plan and your financial situation. The policy runs a bit cheaper than low-end plans, but MaxCare also has a high deductible. For comprehensive coverage, you may be better off choosing a third-party warranty.
What is CarMax's Return Policy?
You can return any car purchased from CarMax within 7 days for a full refund.
Can You Negotiate with CarMax?
CarMax uses a "no-haggle" buying and selling policy. The price you see is what you will pay. The offer they give is the only one they will accept. There's no back and forth on negotiations, so this simplifies and speeds up the process.
Does CarMax Offer Financing?
CarMax does offer options for financing. Their finance rates vary from 3 and 5% to 20% APR, with contract lengths between 36 and 72 months. Most credit profiles will qualify for financing from CarMax, though people with lower credit can also opt for a co-borrower.
CarMax provides fast financing decisions, often in less than 20 minutes. If you find a better loan, CarMax offers a three-day payoff program. The process is quick and simple.
- Click the link on the vehicle’s Car Page.
- Speak with a sales consultant about financing options.
- CarMax financing options consider your personal credit history, vehicle details, application information, and down payment.
- You receive a haggle-free, transparent financing offer. CarMax does not negotiate APR.
Does CarMax Check Your Credit Score?
Yes, CarMax will check your credit score. A credit score is one of the metrics they use when determining financing options. CarMax is often able to accommodate a wide range of credit profiles.
CarMax Review - The Good & The Bad
CarMax Pros: Here's What We Like
Here are some of the qualities customers love most about CarMax:
- Ability to Test-Drive. Because they have physical locations, you can test-drive a vehicle before purchasing (if it's at a location near you).
- Detailed Inspection. They only sell vehicles that pass an extensive inspection and have a clean title.
- Great Quality Vehicles. Since CarMax refurbishes and cleans vehicles before selling, they have a "new car feel".
- Customer Service. While CarMax still deals with unsatisfied customers and complaints, they still have a fairly strong reputation. CarMax focuses on offering a smooth customer experience and addressing warranty coverage cases.
CarMax Cons: Here's What We Don't Like
CarMax is excellent, but it's not without drawbacks. Here are some of the cons to be aware of:
- Higher Prices. They tend to be priced higher than the competition. For one, CarMax has physical locations that add overhead to its operations. Secondly, they perform extensive inspections.
- Lower Offers. CarMax is upfront about buying cars for below retail value. While you will get offers slightly below retail value, selling to CarMax is convenient and hassle-free, often faster and easier than trying to sell privately. To ensure the offer is fair, you should still know the market value and check offers from other dealers.
- Transfer Fees. If you want a vehicle moved to a location near you, you will likely have to pay a non-refundable transfer fee.
- No Negotiation. Haggle-free buying and selling is convenient, but it's not always the best way to get the best price.
What Are Alternatives to CarMax?
CarMax may be a great choice for some car purchases/sales, but it's not the only option. Some of the top places to consider include:
- Used Car Search Engines. Many dealerships publish used car listings on search engines like Rydeshopper, Edmunds, AutoTempest, and CarsDirect.
- Swapalease. On Swapalease, you can buy and sell cars under a lease. Read all about Swapalease in this review.
- Vroom. Vroom is an online used-car dealership that provides a simple experience that streamlines car shopping. Read our review of Vroom here.
- Shift. Shift is a digitally-driven company that offers car buying and selling. Shift owns all the cars they sell and offers haggle-free pricing. Read our guide and review of Shift here.
- Carvana. Carvana is another online used-car dealership that provides financing. Read our full Carvana review to find out more about how it works. See which is better, Carvana vs CarMax.
- Rental Car Companies. Enterprise, Hertz, and Avis are the leading rental car companies, and you can find a good deal on a well-maintained used vehicle. Check out our full comparison here.
- Costco Auto Program. The Costco Auto Program is available for Costco Members. It provides them with prearranged special membership pricing on vehicles in dealerships across the country. Read our full review here.
- Sam's Club Auto Program. Sam’s Club, powered by TrueCar, offers competitive pricing on new and used cars for its members. Read our full review here.
Frequently Asked Questions
Is CarMax trustworthy?
CarMax is an affordable way to buy quality new cars, but they are known for having prices higher than competitors. Make sure to compare prices at several dealerships (including other online used-car dealers) before buying from CarMax.
Is selling to CarMax worth it?
CarMax clearly states that they offer under the market value for your vehicle (as they must resell it to make money). However, selling to CarMax is a fast, haggle-free process that can save you the time and headaches of selling elsewhere.
Can you negotiate with CarMax?
CarMax offers no-haggle pricing. While this saves you time, it also means there's no room for negotiating.
Does CarMax have hidden fees?
While CarMax doesn't charge you to buy or sell with them, you will have to pay for shipping. If you buy from one of their physical locations, you may also have to pay a transfer fee to have the car shipped to your local CarMax, and dealership fees for paperwork.
Is CarMax better than Carvana?
CarMax and Carvana both offer online car-buying, but the main difference is that CarMax has physical locations so you may be able to test-drive or complete your purchase in person.
Are CarMax cars certified?
All cars they sell are CarMax Certified, meaning that they are free of flood-damage and salvage history, while passing a 125+ point inspection.
Is CarMax MaxCare worth the money?
CarMax MaxCare offers an additional warranty beyond the free 90-day/4,000 mile warranty. Buying cars online can be intimidating, and the additional warranty may be a good idea if it makes sense financially for you.