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5 User Reviews

Founded in 1993, CarMax is one of the biggest used-car retailers in the country. The company, formerly owned by Circuit City started with one store in Richmond, Virginia, and has grown to include more than 200 locations nationwide. The chain focuses on an easy, hassle-free shopping experience for customers with an emphasis on no-haggle, upfront pricing.

Is CarMax a direct lender?

Yes, and no. The actual money is offered through several finance sources, including:

  • CarMax Auto Finance
  • Ally Auto
  • American Credit Acceptance
  • Capital One Auto Finance
  • Exeter
  • Santander Consumer USA
  • Wells Fargo Dealer Services
  • Westlake Financial Services

Every year, more than 200,000 people finance a car through CarMax. Shoppers can get pre-qualified online in less than ten minutes. The site includes a financing calculator to help estimate the rates and terms of your car loan based on your car, your availability to make a downpayment, and your credit score.

Loan terms last 6–72 months and excellent rates are based on 4.5 percent APR and less than 580 FICO at 20 percent APR, though this is an estimate to help people budget. Your rate offers may be different, depending on different factors. CarMax even lets borrowers apply with a co-applicant for financing, which isn't always an option at used car superstore type of retailers.

Keep reading for pros and cons of financing with CarMax.

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The Good

  • Inclusive Credit Options
  • Cosigner Option
  • Pre-qualify Online
  • 3-Day Payoff Plan

Inclusive Credit Options

At CarMax, financing is open to people with all types of credit. Rates are available from several different credit profiles, from subprime to excellent, but not everyone gets approved, and your individual rates will depend on your personal credit profile, and the car/amount you need to fund.

Finance applications (and approval) at CarMax are based on the following criteria:

  • application information
  • credit history
  • down payment amount
  • the exact car that you choose to apply for

Due to the company's no-haggle, straightforward goals, there is no haggling over financing and APR. Additionally, workers are sales consultants and they get paid the same, no matter which financing option you choose.

Down payments aren't required, but they are encouraged to help lower your monthly payments.

Cosigner Option

With CarMax, you can apply for financing with a co-applicant to help improve your loan offer. Not all used car superstore-type of dealers offer this. 

Pre-Qualify Online

Consumers can fill outa quick prequalification form online to get an idea of their borrowing options with CarMax. It's fast and easy and doesn't affect your credit score. Once you actually decide on a car and fill out a full application for credit, you will be provided with loan offers from CarMax and its lending partners within a few minutes. On top of online pre-qualification, borrowers also have access to make payments through the CarMax website.

3-Day Payoff Plan

If you find a better financing deal, or simply change your mind, CarMax offers a three-day payoff program. You can get an outside loan to replace your CarMax loan with no payment penalties.


The Bad

  • Restrictions
  • Refinancing
  • Final Payment


When you finance with CarMax, it's clearly just for cars at CarMax. The company's financing program is solely for vehicles bought and sold at CarMax.


If you end up going with CarMax Auto Finance as your lender, just know that you will not have the option to refinance your purchase directly through this lender. However, you can always look to refinance the loan through an outside provider.

Final Payment

Shoppers selecting CarMax's in-house financing through Carmax Auto Finance should note that your final payment may be larger than previous monthly payments. For example, it may include late fees and other unpaid fees. Additionally, CAF uses simple interest retail installment contracts. If you made late payments, there is more unpaid interest than you would have had if you had made payments on-time.


The Bottom Line

CarMax focuses on used cars and offers financing to people with all types of credit, depending on approval of course. It offers no-hassle shopping and minimizes any negotiation work that car buyers have to do.

You can even replace your financing within three days at no additional cost. However, it's important to note that CarMax financing is only for cars bought at this retailer.

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Corinne Crown Point, IN

CarMax came in at a lower interest rate than my bank. They are great at assisting to manage loans. Will buy all my cars at CarMax.

1 year ago


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Amber Saratoga Springs, UT

We bought a car at Carmax and it was nice that they took care of everything including the loan. The loan itself is very fair and easily managed through their website.

2 years ago

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Jessica La Porte, TX

Second time to buy with them and they are friendly, easy and kind

3 years ago

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