Purchasing a vehicle from CarMax is supposed to be a stress-free experience. Customers continue to rave about the service, selection, and pricing, but can you negotiate at CarMax for a better price?
In this guide, I discuss the possibilities of negotiating with the team at CarMax. I show you what the company’s policies are, and I illustrate where you might find some wiggle room.
Can You Negotiate at CarMax?
No. CarMax has “no-haggle pricing,” so it’s not possible to negotiate the asking price. The company has a solid reputation of selling cars for the asking price, which is beneficial if you want to shorten your time at the dealership. This pricing structure ensures you know exactly what you are going to pay.
If you are the type of person that loves the thrill of wearing down a salesperson, this policy isn’t going to please you. However, most people don’t enjoy spending more time than necessary buying a car, which is why CarMax continues to grow in popularity.
Benefits of CarMax’s No Haggle Pricing
1. Fixed Salesperson Commission
When you visit a typical dealership, the salesperson earns money on the commission from the sale. With this structure, these workers become enticed to get more for the vehicle than is needed, so they can pocket more.
CarMax workers do earn commission on the car sale, but the price earned is fixed. It doesn’t matter what that car is sold for – the salesperson is going to earn the same amount. They earn more money by selling more vehicles, so that’s what they are going to work harder to do. It’s never about the price of the car that’s sold, so everyone on the team is going to give the sales their best, even if the customer is looking at a cheap car.
2. Massive Inventory
CarMax has more than two hundred locations. Among these locations, you are sure to find a car in the inventories that appeals to you. CarMax doesn’t focus on a particular brand or model, so you can find a variety of options.
Plus, CarMax is constantly purchasing more cars from customers, so the selection is always changing. If you don’t immediately find what you are looking for, just keep looking. What’s better is that you can look through these inventories online, without leaving your home.
3. Comprehensive Inspections
Before CarMax places a price on a vehicle, a complete inspection is performed. The information discovered during this inspection is used to put into a computerized algorithm for an accurate asking price. The company works hard to figure out the fair market value, which can only be done with this inspection.
With the CarMax 125-point inspection, problems will be unearthed that might not have been seen otherwise. If the vehicle has been involved in a flood, was in an accident, or there’s frame damage, you can guarantee that all of these aspects are going to be disclosed, and the price will reflect the issues. With this information, you can decide if it’s worth your time to purchase the car.
4. Free Vehicle History Report
CarMax won’t sell just any car that’s offered to them. The company is picky about what’s offered. Because they are so proud of what they sell, the company gladly offers a free history report, so you know everything that it’s been through.
If you don’t want to spend a lot of time at the dealership, you might even choose to review all of this information before heading in for a test drive. Many people pick out the car online, look at the report, and have paperwork prepared before visiting a CarMax location.
It’s not difficult to get a warranty from a dealership, but what’s offered by CarMax is unique. For starters, you are permitted to test drive the vehicle for 24 hours before buying it. Once you choose to buy it, you still have a 30-day/1,500-mile return policy to take advantage of. If you aren’t thrilled with the car, you can get a complete refund.
This money-back guarantee provides insurance against problems that weren’t disclosed. If you find something wrong with it after the fact, CarMax will recalculate the value based on the repairs needed and will issue you the refund for the difference. After this 30-day warranty, there’s also another limited warranty coverage that gives you peace of mind for 90 days or 4,000 miles.
What Can Be Negotiated at CarMax
1. Financing Rates/Terms
If you head to CarMax with cash, you aren’t going to get any money off of the purchase. The sticker price is exactly what you are going to pay. However, if you choose to finance the purchase, there’s some negotiating room available for you.
CarMax relies on in-house financing for the vehicle. The company also works with a few second-party financing institutions, so you could bring your own terms to the table if CarMax isn’t offering something good enough. By bringing this offer forward, you might be able to get CarMax to budge on the terms slightly. If not, you still get to take advantage of your bank’s offer and save a little on the financing.
2. Trade-in Value
CarMax also uses a special algorithm for setting trade-in prices as it does with sticker prices. With this advanced algorithm, CarMax can provide a trade-in value quote to you very quickly online, without ever seeing your vehicle. If you aren’t happy with this value because you can show it’s worth more for some reason, it’s okay to ask the company to re-evaluate it. Someone might be willing to adjust the trade-in value based on the information you have.
If you can’t get CarMax to offer more money, there’s still a way to get what you want. Instead of trading the vehicle to CarMax, go ahead and sell it privately. You will get more for the car because this value is higher, which helps you reduce the cost of your newer loan.
3. Warranty Protection
One big seller for all dealerships is the extended warranty protection. Even if the car has nothing wrong with it now, you will still become easily convinced that anything could happen in the future. Without thinking about it, you can easily drop $2,000 or more on this protection. If this money gets added into the financing, you are also going to take on interest on top of it.
While extended warranties aren’t always a poor decision, you need to give special consideration to what’s important. If you are convinced that you need an extended car warranty, start by shopping some third-party providers to see how much money you can save.
There’s one more way to get money from CarMax, even with a non-negotiable sticker price. If there’s work that needs to be completed on the vehicle, you can work out a deal on the service. Before you purchase the vehicle, ask for them to cover the repairs. Otherwise, you might be able to convince them to lower the cost because of these repair costs.
If that doesn’t work, don’t forget the value of tires. It’s always worth asking for new tires, which could cost you several hundred dollars down the road. The worst that can happen is that they will say no.