Auto Loans
Top Companies in 2024
Carvana vs DriveTime
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- Doesn’t require a minimum credit score
- Prequalification is valid for 45 days, giving the borrower enough time to decide
- Carvana prequalification doesn’t affect credit score
- Used cars are in great condition and meet Carvana’s high standards
- Cars delivered as soon as the next day
- Online application
- Nationwide services
- Requires no current bankruptcies
- Auto loan financing only
- No loans for external purchases
- Limited geographic availability
- Lack of transparency
Carvana, headquartered in Tempe, Arizona, offers a unique and streamlined approach to auto financing exclusively for used vehicles purchased through their online marketplace. Founded to revolutionize the car-buying experience, Carvana provides auto loans with no minimum credit score requirement, making it accessible to a wide range of credit profiles. The company's online platform allows users to prequalify for loans in just 2 minutes, with terms valid for up to 45 days, giving ample time to browse their extensive inventory of over 25,000 vehicles. Key features include loan terms of 36 to 78 months, loan amounts starting at $1,000, and a 7-day return policy. Carvana's vehicles undergo a 150-point inspection, with a free Carfax report and a 100-day/4,189-mile warranty. The application process is entirely online, with phone and live chat support. While interest rates range from 7.90% to 27.90%, the absence of prepayment penalties and origination fees adds to the appeal. With a solid reputation for their intuitive technology and extensive inventory, Carvana is particularly suited for those seeking a hassle-free online car buying experience, especially those with less-than-perfect credit.
DriveTime Automotive Group Inc., founded in 2002 and headquartered in Tempe, Arizona, is a prominent player in the used car retail and financing industry. Initially known as Ugly Duckling, the company rebranded to DriveTime to better reflect their focus on providing accessible vehicle options for customers with subprime credit. With over 145 dealerships across the United States, DriveTime has sold more than 1.5 million vehicles, emphasizing a no-haggle pricing model and a robust online financing process that allows customers to secure terms tailored to their credit profiles. Unique features include a 5-Day Return Guarantee and a 30-Day/1,500 Mile Limited Warranty, enhancing customer confidence in their purchases. DriveTime's commitment to customer service is evident through their extensive inventory of over 10,000 vehicles and dedicated sales advisors who guide buyers through the financing process. Customer feedback highlights DriveTime's innovative approach and supportive environment, positioning it as a leader in helping those with financial challenges find reliable transportation. The company also boasts industry credentials through their subsidiaries like Bridgecrest, which provides auto loan servicing and ancillary products, further solidifying their presence in the automotive finance sector.
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- Minimum Accepted Credit Score : Undisclosed
- APR : Undisclosed
- BBB Rating : B+
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- BBB Rating : A+
- Extensive inventory with more than 20,000 vehicles to choose from
- Flexible and multiple financing options
- 7-day money-back guarantee
- Warranty
- Lease Buyout
- Loan Refinancing
- New Vehicle—Undisclosed
- Private Party—Undisclosed
- Used Vehicle
- Lease Buyout—Undisclosed
- Loan Refinancing—Undisclosed
- New Vehicle
- Private Party
- Used Vehicle
- Extended Warranty—Undisclosed
- GAP Insurance
- Limited Warranty
- Mobile Application—Undisclosed
- Online Account Management
- Return Policy
- Extended Warranty
- GAP Insurance
- Limited Warranty
- Mobile Application—Undisclosed
- Online Account Management
- Return Policy
- Hard Credit Check
- Income
- Minimum Credit Score—Undisclosed
- Pre-qualification With Soft Check
- Hard Credit Check
- Income
- Minimum Credit Score—Undisclosed
- Pre-qualification With Soft Check
- Documentation/Processing Fee—Undisclosed
- Late Payment Fees—Undisclosed
- Origination Fee—Undisclosed
- Prepayment Penalties—Undisclosed
- Title Transfer Fee—Undisclosed
- Upfront or Application Fees—Undisclosed
- Documentation/Processing Fee—Undisclosed
- Late Payment Fees—Undisclosed
- Origination Fee—Undisclosed
- Prepayment Penalties—Undisclosed
- Title Transfer Fee—Undisclosed
- Upfront or Application Fees—Undisclosed
- Automatic Payments
- Cash—Undisclosed
- Check—Undisclosed
- Debit or Credit Cards—Undisclosed
- In-Person Payments—Undisclosed
- Mail-In Payments—Undisclosed
- Online Payments—Undisclosed
- Phone Payments
- Automatic Payments—Undisclosed
- Cash
- Check
- Debit or Credit Cards
- In-Person Payments
- Mail-In Payments—Undisclosed
- Online Payments—Undisclosed
- Phone Payments—Undisclosed
- Articles and Videos
- FAQs
- Help Guides
- Live Chat
- Phone—Undisclosed
- Articles and Videos—Undisclosed
- FAQs
- Help Guides
- Live Chat
- Phone
Carvana vs. DriveTime
Carvana and DriveTime each offer unique ways to buy and finance used cars tailored for different needs. Carvana provides a fully online experience, while DriveTime operates nationwide dealerships with flexible financing for all credit types. In this comparison, we’ll examine their services, financing options, pricing, and pros and cons.
Service range and offerings
Carvana is designed for customers who want a seamless online car-buying experience. It offers a wide inventory, allows prequalification for financing, and includes a 7-day money-back guarantee, all completed online. However, Carvana only finances vehicles purchased from its platform, limiting external options.
DriveTime operates more than 130 physical dealerships across the US It caters to customers with varying credit scores, including poor or no credit, and provides in-house financing. Buyers can browse cars online and finalize their purchases in-store, giving them the chance to inspect the vehicle in person. DriveTime also offers trade-in services and a 5-day return policy.
Financing options and pricing
Both Carvana and DriveTime allow prequalification without impacting credit scores. Carvana finances only their own inventory with transparent pricing and no dealer fees, which simplifies costs. Interest rates vary, and there are no hidden fees, but the selection is limited to Carvana’s inventory.
DriveTime offers in-house financing tailored to individual credit situations without minimum credit score requirements. They don’t publicly disclose specific rates but are known for accessibility, making it a solid option for buyers with bad credit. Loan terms, down payments, and monthly payments are customized to fit individual financial circumstances.
Security and compliance
Carvana and DriveTime prioritize secure transactions. Carvana adheres to compliance standards but has faced regulatory issues, including a license suspension in Michigan for non-compliance. This might concern customers who value a spotless record.
DriveTime has an A+ rating with the Better Business Bureau (BBB) and fewer compliance issues, making it potentially more reliable for those who prioritize regulatory stability.
Advantages
Carvana’s main advantage is convenience. The entire process can be handled online, which is ideal for those who prefer digital transactions. Their 7-day money-back guarantee provides a cushion for those unsure about their purchase.
DriveTime’s strengths lie in flexibility and physical locations. Their in-house financing is tailored to various credit situations, and the 5-day return policy offers a similar peace of mind. The ability to visit a dealership and inspect vehicles adds assurance for buyers.
Disadvantages
Carvana’s limitation is its exclusive financing, which only applies to vehicles from its platform. Those who want to buy from other dealerships or sellers must look elsewhere. The regulatory issues might also deter some buyers.
DriveTime’s lack of transparent pricing can be frustrating, as specific rates aren’t shared upfront. Completing the purchase requires a dealership visit, which may not appeal to buyers who want a fully online process.
Conclusion
Carvana and DriveTime suit different buyer preferences. Carvana is perfect for those who value a simple online experience, while DriveTime is ideal for buyers seeking flexible financing and in-person vehicle inspection. Each platform has unique advantages, so the best choice depends on your priorities.