Carvana is a one-stop-shop auto dealer. Not only do they sell high-quality used cars, but car shoppers 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 its 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 buying a car online with Carvana unique. Keep reading to learn more below.
Carvana Application Requirements
You can finance through Carvana or you can utilize third-party financing. However, if you choose Carvana financing, the car buying experience goes by much more smoothly and quickly. But, 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 cosign for a car 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 at Carvana
Carvana offers used car loans for all credit types. Carvana doesn’t have a minimum credit score requirement. Low income, low credit, and no credit borrowers are all encouraged to apply. 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 your auto industry credit score first, ranging 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 need a down payment because they are not considered a financial risk. However, borrowers in higher tiers often have to make a down payment and pay higher interest rates and monthly payments.
Can I qualify for Carvana financing if I have bad credit?
Carvana states that as long as you are 18 years or older, make at least $4k per year, and have no active bankruptcies, you can finance your purchase through Carvana. However, in the state of Georgia, you are required to be 19 years old.
Fees and Rates
The rates borrowers receive are all contingent upon income and credit history. Once you apply for a Carvana auto loan, 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.
One of the best ways to find a great auto loan lender is by reading third-party reviews. You can discover what actual customers are saying about them before you choose to do business with them. The Better Business Bureau (BBB) currently gives Carvana an A+. While they have quite a few complaints, they also serve lots of customers. You will find many 4- and 5-star reviews of Carvana at several other review sites as well.
Carvana Application Process
The Carvana buying process is done entirely online and doesn’t take long to complete. First, 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 car buying 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 purchase process before there are any hard credit checks, which hurt your credit score just a bit.
After you fill out the application, you’ll see personalized financing terms under the picture of each Carvana vehicle listed. Monthly payment, minimum down payment, and APR will show up under each vehicle.
Again, you’ll be able to see all of these auto 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 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. Next, 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 financing.
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 your information, Carvana will send you tailored lists of cars that fit within your budget.
You can also use their auto 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 drive. So Carvana gives car buyers a 7-day window to return their car purchase should they decide they’ve made the wrong choice.
Carvana has a 150 point inspection process for every car they sell. As a result, none of their cars have ever had any reported accidents. Plus, 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. You can also get the car delivered right to your driveway, and you can return it if you want.
Carvana does everything it can to make you a happy buyer. With a seven-day money-back guarantee, excellent customer service, 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.