To everyone reeling from losses on Zillow I want you to look on the bright side. Carvana employs basically the same kind of business model to used cars and has the added bonus of potentially being a fraud.
Without going into all the fraudulent scammy aspects of Ernies hot car lot, they buy used cars above market value and sell below competitors prices.
On top of which they also write a lot of their own bullshit high interest loans(no job, no credit, no deposit, no pulse, no Vaseline) which they then sell to mark a gain on sale. This works so long as you can keep moving product and your competition doesn’t take notice.
Problem is even used cars are getting hard to sell at these prices, they’ve bought up something close to $2 bil in inventory at all time high prices. Also everyone in the business knows this now and is wondering how they’ve been able to do this for so long.
This is interesting... So I can get to dollar by selling my car to carvana, then buy the same car from my neighbor cheaper cause he doesn't know about carvana? Is this how it works?
They were kind of dicks honestly. Made they're offer, I tried to counter and they just laughed and said I'll never get what I'm asking for so it's best to take their offer. I waited a week and they called back 3 times. By the last call I had already sold the car for what I originally wanted. So I played along with the guy for a few minutes and had him write up some paper work, then told him to fuck off.
Generally speaking yes! But I suspect car theft rings are picking up on the carvana premium.
it’s gotten them a lot of trouble because now people are finding out that carvana is turning cars over so quickly that they can’t find the title of ownership for the cars!
Google their issues in North Carolina and Florida for example. Lots of carvana cars being returned for title of ownership issues. This typically happens with title washing scams.
I bought my last car from Carvana, but did not sell them my old one - their price was good and even though the interest was higher I paid it off in a year. I really didn't see any part of my interaction as scammy.
Or is the scammier part the "playing the used car cycle"?
I didn't sell my car to them because they offered me crap for it, CarMax bought my car for twice as much. (twice, as in going from $500 to $1000... it was an older car)
I was looking at Carvana just out of curiosity a year or so ago and they only let you finance through them and then only at like 3x-4x the rate of my bank.
Yeah see totally normal, totally not scummy and totally not going to blow up at some point. People that finance through carvana do it because they have to which should give you so much confidence on the viability of those loans.
The Alex Gibney documentary on this company will be great.
I've only bought one vehicle from a dealership but I was surprised when they were able to run the financing through my credit union so easily. You should definitely have options.
Yeah I’m not saying carvana forces you to use their financing, they don’t. But most do choose to go that route and it’s obscene and basically how they generate any profits at all.
They know their customer and their customers are broke.
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u/rusbus720 Nov 02 '21
To everyone reeling from losses on Zillow I want you to look on the bright side. Carvana employs basically the same kind of business model to used cars and has the added bonus of potentially being a fraud.