William Lipovsky
CarMax — the largest used car retailer in the U.S. — does not offer leasing options for its selection of used cars, but it does allow you to finance your used car purchase either in-house or from a third-party bank or lender.
Although its main market is used cars, CarMax also offers a small selection of new cars. CarMax does not offer leasing options for this selection, except for new cars and trucks at its two Toyota dealerships.
When determining in-house financing options for both new and used cars, CarMax considers your application information and credit history, your ability to make a down payment, and the value and condition of the car you want to buy, according to the company’s website.
Why Places Don’t Lease Used Cars
Leasing a used car generally carries more risks than leasing a new car. The older the car is, the more service issues it will likely face. Many lease agreements come with strict maintenance schedules for the car, and most dealerships require you to pay for these expenses out of pocket, despite the fact that you do not own the car.
Consumer Reports also notes that it is harder to predict the resale value of a used car at the end of a lease, so you may end up paying too much over the life of the lease.
It is worth noting that the used car leasing market has been on the rise in the U.S. in recent years because it provides a way for dealerships to re-market cars that have already been leased once but are in good condition and have few miles on them.
Additionally, beware of “buy here, pay here” car dealers that lease used cars. These lenders typically market their car sales and leases toward individuals with poor credit history, and they will often charge higher interest rates and repossess cars quickly. If you are behind on lease payments and have to file for bankruptcy for any reason, the lender may still be able to collect on the debt or repossess the car.
Where to Lease a Used Car
CarMax and its main competitors — AutoNation, Cars.com, Carvana, and Shift — don’t offer leasing options for used cars. To lease a used car, you will typically need to take over an existing lease or work with a local car dealership to create a new lease agreement.
Taking over someone else’s car lease is similar to buying a used car from a private party. You can even use an online exchange site like Swapalease.com to help you find a used car to lease.
Alternatively, you can shop for a used car at a local dealership and ask about lease options. You can search for a local dealer through sites like Autotrader, Edmunds.com, and Kelley Blue Book.
Not all dealers will work with you on a used car lease; your best bet is to choose a car with manufacturer financing. Manufacturers that typically offer used car leases include Acura, Audi, BMW, Chrysler (which also finances Dodge, Fiat, and Jeep), Ferrari, Honda, Hyundai, Infiniti, Kia, Lexus, Lincoln, Mazda, Mercedes-Benz, Mini, Mitsubishi, Nissan, Porsche, Toyota, Volkswagen, and Volvo.
For more on CarMax’s policies, see our post on selling a damaged car to CarMax.
