Wednesday, October 20, 2010

Review of Carmax Appraisal Process.

Or, You Won't Get Anywhere Near the Real Value of Your Car.

I was trying to sell my car first before I could get a new one from a dealer. Knowing how dealers always lowball you when you come in with a trade-in, I decided to take it to Carmax. They have a great reputation for no haggle prices, non-pushy sales staff and a general non-intimidating atmosphere. And, I’ve heard they were very fair in valuing your car and give you top value.

Full disclosure: I was not trying to buy a used car from Carmax, I was only trying to sell my car first.

First, the showroom is very clean, open and airy. All their employees wear these blue polo shirts and matching tan pants. There is rep that informs you of their process. However, this person isn’t the one who inspects your car. It’s is someone else. Also, you don’t get to watch over the shoulder of the appraiser (contrary to what the Carmax website says).

It takes about 15-20 minutes to wait to see your rep, then another 45 minutes for the appraiser to do the inspection. Budget about 1 hour for the complete process.

Everything was great except for the real reason you go there: top dollar for your car. They came in with a $6,000 price on my 4runner. I understand that my gas guzzling 4runner may not be high on buyer’s lists these days, but I saw some 4runners on their lot, the same year as mine that they were selling for $11 to 12K! Their inspection process rated my car as “good” with just two issues: a dented rim and some dents on the doors. Other reasons they gave were: their inventory system was no conducive to buying more 4runners and resale possibilities of my car.

I checked Kelly blue book(Kbb.com) and for a seller trading in a 4runner, my range was $10-11K (fair to very good). I understand that Carmax needs to make money but they didn’t even come close to the low end of the Kelly blue book low range. Couldn’t Carmax make money by offering me $9K or so?

My suspicion is that they’ll find something minor with your car, then highlight it and say that there’s something really wrong with it. Who doesn’t have dings on the doors?

In sum, I can’t recommend Carmax to sell your car to. Stick to Craigslist, classified ads or any of the numerous online classified car sites. Carmax is just like a regular dealer in trying to lowball you.

Pros: open process, free coffee.
Cons: Don’t offer you close to the real value of your car. Heck, they don’t even come close to the low range of Kbb.

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