Carvana: Titling Process Challenges

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Why are you saying that this tax is related to the title?

Some people may not want to trade in their vehicle because they might not get the tax credit they were hoping for on the next vehicle they purchase. It might be better to sell it to a neighbor for cash and use that money towards the new vehicle. Having that knowledge and option upfront is what DLRdmv does for Carvana. These are the intermediate steps of trading in and purchasing a vehicle that not everyone considers until afterward. Sometimes, people end up overpaying taxes or experience buyer's remorse, realizing they could have saved $1,000 or $2,000.

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Returning to our example, I called the bank and said, "I'm trading this car in and financing the new car with Carvana. I need the title." Will Carvana automatically contact the bank, or should I do something? How does the communication happen? Is there a platform, or do I need to call people?

Problems arise when this process breaks down, like when you need a duplicate title after 30 days and can't reach the customer. Without a title, they can't legally sell the vehicle, which is common in the industry.

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So, when you purchase a car from Carvana and they deliver it to you, do they always deliver the title with it?

Carvana got some criticism because people would make straight cash purchases, and the delivery drivers were told the title was in the glove box. They would drop off the vehicle, open the glove box, and find no title there. The title might still be at an office somewhere. After about a week of not finding the title, they would have to do a duplicate title process. As a customer, you need the title because if you can't show proof of ownership, your insurance won't allow you to use low liability insurance. You'd have to get full coverage until you can show proof, which might cost an extra $150 a month. So, they're supposed to provide the title, but sometimes they don't, which caused some trouble because they weren't double-checking.

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