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Not mentioned is that they've been forced or sued to halt sales operations in multiple states multiple times (Colorado, Illinois, Michigan, Florida) and had rep
by duped 4y ago
Not mentioned is that they've been forced or sued to halt sales operations in multiple states multiple times (Colorado, Illinois, Michigan, Florida) and had reported issues in California, Texas (among others, these are just the ones I remember). I believe it's all been for the same reason - in most states, car dealers have to send you a title within a certain time frame (like 30 days) of the purchase, and Carvana has been incapable of doing that.
This is total speculation, but it seemed like they were purchasing cars and selling them before they had titles on them. I believe some people never received their titles. I wonder how many of them were stolen vehicles fenced through a startup too concerned with scale to comply with the law.
- fy20 4y agoWhy are used cars sold without a title in the US? In my country you need a green registration card (equivalent of the title) and a secret code from the equivalent-of-the-DMV (to prevent selling stolen cars) in order to register a vehicle in your name. Nobody would pay for a car without getting those at the time of sale, as you can't register the car, so it's effectively not yours - a sales contract means nothing if you don't get them.
- iudqnolq 4y agoI'm not sure that's common. When I bought a used car in Colorado I was handed the title at the time of purchase and still had a massive pain registering in time. (My apartment complex contracts with a predatory towing company that makes money by finding reasons to tow your car and charging you for the car's return. One of their excuses is not registering fast enough)
- whakim 4y agoThe reason this happens likely isn't negligence, but is instead a fundamental flaw in any kind of two-sided car marketplace. First, you have to buy the vehicle, and in many cases when you buy a car you have to pay off the seller's loan. In this case you don't get the title immediately - you have to wait to receive it from a financial institution. But you can't sit on a car until you actually have that title in hand - used car margins are razor-thin and cars depreciate incredibly quickly - so you need to sell the car first and hope you receive the title in time. This entire process is made even more complicated by the vast array of small banks and credit unions you have to deal with during the payoff process - many of whom have byzantine processes and can't possibly conceive of a car dealership that doesn't operate like the local auto lot. I have no particular love for Carvana but I am sympathetic in this particular instance.
- duped 4y agoI don't discount inefficiencies in the market or would call it negligence, other than I don't think it is legal to sell a vehicle without the title. What is to prevent fraud?
- whakim 4y agoThere's a difference between not having the title and not having the title in hand. What Carvana does in this respect isn't illegal.