Carvana is a one-stop-shop auto dealer. Not only do they sell high-quality cars, but borrowers can also finance through them as well. But that’s not what makes Carvana stand out. What makes Carvana different is its hassle-free return policy…and their coin-operated Car Vending Machine (see image below).
On top of that, you can get a 100-day warranty included when you purchase. There are countless features that make Carvana financing unique. Keep reading to learn more below.
Carvana Car Loan Application Requirements
You can finance through Carvana if you want, but it’s not necessary. However, if you do decide to work with them, the purchase process goes by much more smoothly and quickly. Of course, there are a few requirements and conditions you’ll have to meet:
- You’ll need an annual income that is at least $10,000 or more. If you’re paying alimony, child support, or a separate maintenance income, you don’t have to list them if you don’t want to.
- You have to be at least 18 years old.
- You cannot have any active bankruptcies.
- You cannot cosign. Carvana only offers single-buyer car loans.
- Credit cards cannot be used for your down payment. Down payments can be made either through an ACH withdrawal, cashier’s check, or a money order. If you have a trade-in the value of that car can be used for a down payment, too.
If you want to co-sign for an auto loan with your bank or credit union, that is possible. Carvana works with most third-party lenders, but will not work with Capital One, Road Loans, or Car Finance Capital.
Types of Auto Loans Available
Carvana offers auto loans for all credit types. Low income, low credit, no credit borrowers are all encouraged to apply and there’s no reason not to since pre-qualification is only a soft credit check.
As with all auto lenders, Carvana does use the tier process to determine what kind of rate you’ll receive should you decide to finance through them. To see what kind of tier you’ll be placed in, you’ll need to know what your auto industry credit score is first, which ranges from 250 to 900.
The tier ranges are broken down as follows:
- Tier 5/ F Tier: (250 to 520)
- Tier 4/ D Tier: (520 to 580)
- Tier 3/ C Tier: (581 to 659)
- Tier 2/ B Tier: (660 to 699)
- Tier 1/ A Tier: (700 to 739)
- Tier 0/ A+ Tier: (740 to 877)
The goal for every borrower is to be in the lowest tier possible. Borrowers in tier one and zero often don’t even have to make a down payment because they are not considered as much of a financial risk. Borrowers in higher tiers often have to make a down payment and also pay higher interest rates and monthly payments.
Fees and Rates
The rate borrowers receive are all contingent upon income and credit score. Once you apply for pre-qualification, any rate you’re given is good for 45 days provided the information you gave was correct This is 15 days longer than most lenders, whose offers expire after 30 days. This gives you more time to be as selective as you want when new car shopping.
Carvana Application Process
The pre-qualification process is done entirely online and doesn’t take long to complete. You’ll enter your full legal name, income, address, and date of birth. From there you’ll give them your email and phone number and agree to a few conditions. The conditions you’ll have to agree to include:
- Continuing with e-sign as a basis for consent (meaning the entire process can occur online from there on out).
- Agreeing to let Carvana call and text you about information related to your account (no worries, you can opt out of this).
The best thing about the pre-qualification process is that there is no hit to your credit score. So if you’re merely curious about the company, you can go fairly deep into the process before there are any hard credit checks, which hurt your credit score just a little bit.
After you fill out the application, you’ll see personalized financing terms under the picture of each vehicle they have listed. Monthly payment, minimum down payment, and APR will show up under each and every vehicle.
Again, you’ll be able to see all of these loan terms without there being any hit to your credit score, and all terms are good for 45 days. They could, however, stay the same after 45 days provided your personal information hasn’t changed.
Carvana’s special features are really what makes it stand out as a company. It’s got a lot going for it elsewhere, but it’s the small details that push it into the limelight.
Know What Your Car Will Be Worth
One of the coolest things about Carvana is that they have a hassle-free sell or trade process. You can get an offer on your used car in less than two minutes. You don’t need to provide any pictures, nor do you even have to get it inspected. Better yet? They’ll even pick it up from you.
Go to the homepage and find the “Sell or Trade” section. Click the “Get Your instant Offer” button and you’ll be asked for the following information:
- License plate number
- Vehicle details, such as mileage, transmission, and common interior and exterior features
- Condition of the car
- Whether the car has ever been in an accident
Once you enter the required information, they’ll give you a quote that you can either accept or walk away from. Going through the information process does not commit you in any way to selling or trading in your vehicle. However, the information can be invaluable to many borrowers who are in the planning stages of getting a new vehicle.
Browse by Monthly Payments
Another great thing about Carvana and its website is that you can shop around by picking what car payment you want to have each month. They have over 11,000 cars in their inventory, and you can save yourself time by clicking on what kind of payment terms you want. Of course, the monthly payments are more accurate if you use Carvana as your lender.
You’ll be asked three questions to narrow down search results:
- Total down payment?
- Total loan term? (How long you want to make payments on your car)
- Desired monthly payment?
Once you enter in your information, Carvana will send you tailored lists of cars that fit within your budget.
You can also use their loan calculator to personalize your financing terms without impacting your credit score.
7 Day Test Own
Knowing whether you truly want to own a car takes longer than just a test spin. Carvana gives car buyers a 7-day window to return their purchase should they decide they’ve made the wrong choice.
Carvana has a 150 point certification process for each and every car they sell. None of their cars have ever had any reported accidents, and they give you every piece of information they could possibly give on the car, including special features, safety recalls, and noticeable imperfections.
Combine this with the 360-degree virtual tour, and the ability to buy a car from your couch doesn’t actually seem like such a bad idea — especially since they’ll deliver the car right to your driveway and you can return it if you want.
Carvana does everything it can possibly do to make you a happy buyer. With a 7-day money-back guarantee and a 100-day or 4,189-mile warranty, it’s obvious they want your business. The bottom line is that Carvana has a lot going for it and should be on your list for both purchasing and financing your next new car.
Check out our other auto loan reviews below to continue exploring your options.