Exactly how does car fax work?

[Sigarms]

Been hunting for a used auto since both kids have their learners permit.

Can anyone explain how car fax works, and how do they make money?

Came across a 16 year old car with pretty low mileage IMO for the selling price, free car fax history. Locally bought (for that area, going to be a two hour drive on my end) and it was probably one of the most detailed car history report I've ever seen, including the water pump and time belt change at the correct interval with oil changes and all the other maintence.

Seems all car fax reports always including where you can see what state it was bought in, when, mileage and where it was transfered with little to no service work records, along with if any accidents were reported or the auto has a salvaged title (my current Avalon was bought from a Toyota dealer, but it was a one car owner from NYC of all places, the irony of being in NC and buying a car from NY and it's pushing 400k LOL).

Don't get me wrong, I wouldn't buy a car only on a written report (car fax) without seeing the car, driving it and having a mechanic look at it, but it does offer at least some more "third party" info on the car.

There is a part of me that thinks car fax can be nothing more than a scam because I'm just not certain how they make money unless the auto dealerships of all sizes pay to have the car fax report. Car fax is a business, and businesses are in business to make money. Just don't know enough about the industry is figure out their angle.

 

[Diggin It]

They're basically a subscription and advertising service for dealers and businesses:

Partner with CARFAX

Plus, they sell reports:

Get a CARFAX Report Now

 

[Gunny]

I think they're charging right at $40 to look up one car for an individual, I'm sure the dealerships get a much cheaper per car report.

Around this area, only the dealerships and body shops report repairs to CarFax, the smaller repair shops don't, so while they may have a lot of info on a vehicle, it's possible that they don't have all the info for a particular car.

 

[Tomtint]

You can get a fair amount of data from Carfax, but not 100% certainty. If a car had a insurance claim or accident..it will most likely show up, but if it was a small fender blender.it may not. If it was serviced at a dealer, it may show up, if it was serviced at Joes tube and lube..it may not. If it was inspected at a private garage that does state inspection stickers it may show up as well. It's a very minimalist gauge of a cars past. Try to read between the lines to get an idea of how the car was cared for.

 

[Sigarms]

I think they're charging right at $40 to look up one car for an individual, I'm sure the dealerships get a much cheaper per car report.

I would understand that. However, the one I found off auto trader was provided by the dealership and didn't cost me anything. I honestly can't remember paying for a car fax report, which is why I'm wondering (added this one car report is the most detailed report I've ever seen per vehicle history).

 

[Diggin It]

I would understand that. However, the one I found off auto trader was provided by the dealership and didn't cost me anything. I honestly can't remember paying for a car fax report, which is why I'm wondering (added this one car report is the most detailed report I've ever seen per vehicle history).

Again, it's a subscription based service for dealers and vehicle selling classified ad sites. Individuals can buy reports for $40, but dealers might pay a buck or five for them and the classified ad sites might roll them into the listing fees. Somebody pays for them, usually the seller/dealer.

 

[Sigarms]

Try to read between the lines to get an idea of how the car was cared for.

I've got like 8 pages of this.



One car owner bought from the original dealership until it looks like the same dealership sold it to a smaller car lot to sell after the original owner. My only question is that it seems its the dealer sold it on 10/14 of this year and the smaller dealership isn't listed. That said, looking at online reviews of the smaller car lot, seems to be mostly positive reviews with the couple negative reviews being that the people didn't actually buy a car there, just thought they didn't "push" the car hard enough on them, like they didn't care to sell cars (which doesn't worry me).

 

[kenmac]

Anyone that sells a vehicle can obtain a car fax. Either you will pay for it or the seller will pay for it.

Car fax relies on body shops, etc, to report any damage. If the damage isn't reported. then car fax has no idea of any damage.

If I own a garage, and you bring your vehicle in to me for a new engine. If I don't report that I have in stalled a new engine in your vehicle. Car fax will never know.

I have a 2007 ram truck that I bought from a dealer used. He provided me with a clean car fax.

After buying the truck. I found just by looking at several things it had been in an accident.
Doesn't matter to me, because many vehicles on the road today have most likely been in some sort of an accident

 

[fishheadbob]

I was looking at a used BMW on the dealership website. The Carfax was clean, but in the dealerships' writeup of the car they plainly said it had a blown engine (no wonder it was so cheap.) I figure if you had the engine done at the dealership then it would turn up on the Carfax; If someone bought the car from the dealership and had Bubba drop a new engine into it, probably not the case.

 

[PILOON]

I once purchased a Jimmy, 3 year off lease, that had a mere 20Kms on the clock.
Friends bugged me saying the clock had been turned back.
Well a friendly GM dealer accessed the vehicle records and it showed one long trip and a warranty fix on the trip.
All records showed oil changes tire rotations etc as it had been on a full maintenance contract.

The previous driver was a technician that serviced computers at a government location and lived close by hence low mileage.

I drove/owned that Jimmy for 10 years and overall it cost me a mere $1000/year (not counting gas and insurance) for maintenance and minor repairs.

An I did it again on my present Kia Serento.
3 year off lease, one owner driven and so clean that all the frame and underside still sported factory paint.
Dealer installed all new brakes and new snows upon delivery.
Still driving the Kia with no major issues, just maintenance.
(and love the all wheel drive and all wheel lock/anti skid for my hilly icy roads and driveway.)
The Kia came with a mere 30,000 Kms on the clock!
Can't do better than that!

BUT, takes time and patience to shop those kind of deals.

LOL, when shopping the Kia (at a Mazda car lot) the sales rep asked what I wanted,
I said Just like hat Jimmy out there but newer and lower mileage.
They showed the Kia (LOL, same color by the way) and I purchased after 1/2 hr of back and forth haggling.

 

[Oaktree]

I've got like 8 pages of this.

View attachment 628464

Yeah, I got one like that when I bought my Jeep. 12 years' worth of oil changes, state inspections, tire rotations and a couple minor repairs. What it didn't mention was that it had apparently been in an accident at some point. Didn't notice anything amiss until I started to get some bondo cracks a couple years later.
It's been a great vehicle, and I'd buy it again but I wish I'd known about that if for no reason other than bargaining leverage.

 

[sd455dan]

I think they're charging right at $40 to look up one car for an individual, I'm sure the dealerships get a much cheaper per car report.

Around this area, only the dealerships and body shops report repairs to CarFax, the smaller repair shops don't, so while they may have a lot of info on a vehicle, it's possible that they don't have all the info for a particular car.

YEP family member wanted to buy a Ram truck from a small dealer and she ordered a Carfax,

No (Reported) accidents...

Put it on the lift and there was obvious previous damage along with partial Respray of the Body paint.

Up to that point I thought Carfax was a pretty Good indicator, Not so much now.

Luckily she had not finished the purchase.

 

[caver]

I was at a dealer in Dexter MO years ago looking for a used commuter car of a specific model. Something looked off and I suspected body work. I asked the sales guy can I get a car fax and he responds yeah if you are going to buy the car. Yeah I'm not giving any of my money unless I see a report. He backpedaled a bit saying well the reports cost us money and serious buyers smoke blowing, more smoke blowing. I left the dealership. I bought a subscription to Experion's similar service Auto Check. It showed a deer strike report and frame damage.

 

[PILOON]

Once purchased a vehicle from a Leasing firm.
(B4 CarFax)
Later on rust showed on door and rocker panel a due to undeclared damage history. I was told 'full of Bondo"
I complained to the Leasing and they virtually gave the car to me due to 'undeclared history'.

Today I'm a lot wiser.
I learned how to spot Bondo repairs and insist on the car on a lift to examine the undersides.

Here in Quebec we have a good deal with consumer protection.
Any car over $10K from a dealer is automatically protected for 100% for first 30 days.

I purchased a Toyota MRE from a dealer, promptly took it to local Toyota dealer for a full checkup. (OK cost a few$$'S)
Armed with their report went back to vendor and demanded satisfaction.

Well that dealer had to spent about $1200.++ to make things right or lose his dealer license but I ended up satisfied..

 

[Sigarms]

2001 Honda Accord, 4 banger, 96k, pretty much mint condition, $4,450 (still need to pay NC tax and tags as I brought the car back from Virginia yesterday. From what I've found, I can't complain about thata price (2012 civic couple miles down the road from me with 120k miles looking at 8k which was way high from what I've seen).

I have a dedicated Honda mechanic that I go to for the more important stuff, he went over it, and no complaints as all the service has been done it. Some little things I need to spend some money on, but that's to be expected IMO.

The previous car's only was a woman, over the age of 65, and she traded the car in this year to get a larger Honda so she can get in and out of the auto better. Very nice woman, drove it locally to work which was about 3 miles from her home. She actually gave me a call back because she said I sounded nice

I understand car fax is not perfect, and buyer beware. Best time to look for a car IMO is when you don't need one and can take your time. It's just that this was the FIRST time I ever got like 8 pages of a cars history where it was taken to the same dealer for like 18 years and I generally never have to pay for a car fax.

The added reality is you can also buy a brand new car, drive it off the lot, and spend more money on a new car than a used car. I break it down by total costs including ALL maintenance fees (less gas) divided by the miles on the vehicle to see what kind of money you're actually spending on the overal car's history with you. My Avalon is stull running which comes out to .0555 per mile since I've owned the car. Pretty good IMO.