CarsDirect vs. Vroom: Which offers better auto loans?
Finding an auto loan can add an extra step when you are buying a car. Luckily, both CarsDirect and Vroom offer a convenient solution when you are shopping. Both companies offer an online experience where customers can both search for vehicles and apply for vehicle financing in the same place.
Neither company is a direct lender, but they do connect auto loan applicants to their lender networks to find auto loan options. CarsDirect offers the widest network of lenders, but Vroom offers an all-inclusive car buying experience that includes title registration and convenient vehicle search features.
CarsDirect vs. Vroom at a glance
Loan details vary among each company’s partner lenders, but here’s what we know.
Bankrate score | 3.6 | 3.6 |
Better for |
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Loans offered |
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Loan amounts | Varies by lender | Varies by lender |
APRs | Varies by lender | Varies by lender |
Loan term lengths | Varies by lender | Varies by lender |
Fees | None | None |
Minimum credit score | Not specified | Not specified |
State footprint | Not specified | Not specified |
Time to funding | 1-2 days | As soon as the day you apply |
Autopay discount? | Varies by lender | Varies by lender |
Refinancing restrictions | Varies by lender | N/A |
CarsDirect auto loans
CarsDirect isn’t a direct lender. Instead, it connect customers to a large network of lenders. It scustomize loan offers for each individual by connecting them with lenders that cater to where they live. CarsDirect also allows customers to buy used or new vehicles through its website, making it a convenient way to both buy a vehicle and find auto loan options.
CarsDirect states it caters to shoppers with bad credit, no credit or a past bankruptcy. It also offers refinance auto loans. Interested consumers can fill out the form on the website to find out which loans they qualify for. CarsDirect claims the form takes 60 seconds or less to complete.
While CarsDirect offers the convenience of a lender network and car-buying options all in one place, it provides little details about specific loans, interest rates or repayment terms available. Customers must fill out their form to find out more details.
Pros
Convenient car buying experience: CarsDirect connects customers to both car loans and cars to buy all in one place. Unlike Vroom, you can shop both new and used cars through the site.
Wide network of lenders: This may up your odds of finding a lender willing to finance your purchase, especially if you have past or present credit challenges.
No fees: There is no extra cost to using CarsDirect to find auto loans. However, partner lenders may charge fees.
Cons
Few loan details available: The company doesn’t offer much detail about interest rates, repayment terms or loan fees on their website.
Poor reviews: Online reviews complain about distribution of personal information and poor customer service.
Likely high rates: While rates aren’t listed online, lenders offering bad credit auto loans tend to charge hefty interest rates.
Vroom auto loans
Similar to CarsDirect, Vroom also offers its customers the opportunity to purchase and fund a used vehicle. Vroom also doesn’t offer direct lending. It work swith several lending partners to connect customers with auto loans. Lending partners include Chase, Ally and United Auto Credit.
Vroom offers several convenient features. Customers can search for vehicles and filter by several auto loan features including loan term, monthly payment amount and credit score. Vroom also allows interested loan applicants to get prequalified for an auto loan. Vroom also allows customers to have a co-signer on auto loans, which is a helpful option for those with poor credit or no credit history. Plus, Vroom will deliver your purchased vehicle right to your curb, unlike CarsDirect.
Unfortunately, Vroom doesn’t give much detail about what types of loans are offered through their lending partners. Specific interest rates and credit score requirements aren’t provided.
Pros
Prequalification option: Customers can get prequalified for an auto loan on the Vroom website.
Search for vehicles by loan terms: Search feature on the website allows you to search for vehicles by monthly payment amount, repayment terms and down payment amount.
Vehicle registration services included: In most states, Vroom will register the vehicle for you if you finance through them.
Cons
Minimal loan information provided: Vroom doesn’t provide many details about loans available because it varies with each lender.
Not available in all states: Vroom financing isn’t available in Pennsylvania.
Limited inventory: Instead of listing many dealerships’ available new and used inventory, you can only used Vroom to shop for used cars offered through the site.
How to choose between CarsDirect and Vroom
CarsDirect and Vroom provide similar car-buying experiences, both offering multiple services conveniently in one place. However, CarsDirect offers a more versatile lender network for auto loans, while Vroom gives customers a convenient and simple car-buying experience.
Choose CarsDirect for their large lender network
CarsDirect has access to a wide variety of lenders through their lender network. This helps them connect all types of customers with auto loans that fit their needs. This includes loans for individuals with bad credit, no credit or a history of bankruptcy.
While Vroom also has a lender network, they don’t seem to have as many lenders available. CarsDirect partners with thousands of different lenders, allowing them to offer a wide variety of loan types. The downside is that many smaller, online lenders don’t have a well-established reputation. While Vroom only mentions a few lending partners on their website, they tend to be well-regarded banks and credit unions.
Choose Vroom for the most streamlined experience
Vroom makes it easy for customers to buy a vehicle completely online. Its simple website has customizable search features for vehicles. Customers can search for specific vehicle types by make, model or year and filter by the financing types available.
Once customers find a vehicle, the rest of the process can be completed on the website, too. Individuals can get prequalified for an auto loan and then find a lender to fund the loan. Plus, if they get financing through Vroom, the company will complete the registration process in most states. Other car buying experiences would require the customer to visit a dealer in-person and find financing elsewhere.
Compare more lenders before applying
Both companies offer similar experiences for buying a car. They both allow customers to purchase vehicles through their website and find vehicle financing. They also both work with individuals with bad credit to provide auto loans. Neither Vroom nor CarsDirect offers direct lending for auto loans, though, and you’ll only be able to use their financing if you’re purchasing through their sites.
If this model of shopping and financing sounds convenient to you, make sure to check out competitors such as CarMax and Carvana, too.
