CarMax is a scam. I’ve put their process to the test and it’s for sure taking advantage of consumers. Here’s how they operate…

When you take your car to sell at CarMax, they tell you they buy cars at auction prices because that’s all they can get for it. Then, depending on the condition of your car, they invest a small amount of labor into cleaning the car, then put it on their lot at retail prices. In most cases, the difference between auction prices and retail prices is THOUSANDS of dollars. That’s money you could be putting in your pocket, not theirs…

I had a friend who sold her car at CarMax 5 years ago. She had a Honda Civic that she ran into the ground. It had a lot of miles on it and half of the electronics on the car didn’t even work – including the radio – and they gave her $4,000 for it.

I had a Volkswagen GTI – special edition – in mint condition with really low miles. I took it to CarMax to see what I could get for it and they offered me $5,000 less than its retail value and $2,000 less than trade-in value. Upon further investigation on their website, GTI’s with my mileage were selling for more than retail. This is how CarMax makes their money…

The bottom line is this: If your car is a junker, take it to CarMax because you have nothing to lose. If your car is in half way decent condition, CarMax will take advantage of the situation and you.

My suggestions are these: Before you head to CarMax, take your car to a couple of dealerships and see if they’re interested in buying it. Many dealerships will buy cars outright as well… especially if its a popular brand, had no major accidents and in really good condition. Most dealerships will buy competitive brands to make it look like consumers are trading one brand for another so if you have a Nissan, don’t be afraid to hit a Toyota dealership with it. They may offer you more than the Nissan dealership…

Next option is to sell it on Craig’s List. Remember the GTI? Sold it for full retail on Craig’s List with no hassles. You can weed out the crazies by starting with email and phone conversations before you meet and finalizing the transaction formally at a bank, but, it’s much easier than you might think.

And as a last resort, trade your current vehicle for your new vehicle. You’ll still get more on trade than you will from CarMax.

When the company introduced the option to sell your car even if you don’t buy one of theirs, I thought, what a great idea. And it is – if you try to do right by consumers. They count on consumers not wanting to go through the effort of selling their vehicles independently and use it to their advantage. They buy at auction prices and sell at retail prices… sounds fishy to me. I understand CarMax is a business, but, blatant dishonesty about how they re-sell vehicles is just bad business. It may be a good place to buy a car, but, it’s a bad place to sell a car…