Consumer complaint received 2016-08-04
Company: CarMax, Inc.
State: CA
Product: Consumer Loan
Sub-product: Vehicle loan
Issue: Managing the loan or lease

Complaint:
This complaint is for the predatory lending by CarMax ( and it 's affiliated companies CarMax XXXX XXXX and XXXX ). 
The Lender, CarMax, sold me a bundled loan to finance the purchase of a car and an extended warranty on or about XXXX/XXXX/XXXX. 100 % of the cost of the car, extended warranty, taxes and fees, totaled {$49000.00}, were financed. The extended warranty covers the vehicle until XXXX total miles driven or XXXX/XXXX/XXXX whichever is reached first. I originally had no intention of taking out such a big loan to purchase a XXXX vehicle notorious for expensive repairs. However, I was duped into this loan believing that the Lender will cover the repairs under it 's XXXX warranty program, but the Lender failed to perform under the terms of the loan. 
While on my way to work on the morning of XXXX/XXXX/XXXX, a yellow " warning light '' came on indicating " coolant low '' with a message to `` drive moderately ''. I reduced driving speed, exited the freeway, and drove slowly to a XXXX certified auto shop nearby. 
The auto repair shop identified a failed water pump system and requested the claim from CarMax on my behalf. The claim was approved on that day and the repair was completed on XXXX/XXXX/XXXX. Once the water pump system was replaced, the shop was able to start the engine and test the vehicle for safe operation. It was at this time, the diagnostic showed the engine had failed along with the water pump. It was not diagnosed earlier due to a malfunctioned water pump system. 
When the auto shop requested approval for engine repair, the Lender denied the claim. The denial reason was that the engine failure was due overheating caused by owner 's negligence. That denial was disingenuous and malicious with intend to cause harm for the following reasons : 1 ) It is unreasonable for the Lender to automatically conclude the cause of engine failure was due to owner 's negligence over the phone without diagnose the failed engine. Lender asked that the owner ( me ) to pay for the labor cost ( ~ $ XXXX {$3000.00} ) to take apart the engine to individually inspect components that may have caused the failure, then prove the damage was not caused by the owner 's negligence, before the Lender will consider the claim ( not approve the claim ). Lender has absolutely no basis or evidence for owner 's negligence yet claim was denied. 
2 ) Lender claimed engine failed due to over heating. It is impossible for lender to determine the cause of engine failure over the phone without physical inspection. The lender already conceded water pump system failure is covered under the warranty by approving that claim. Since the water pump system supplies coolant to the engine, if the engine overheated due to lack of coolant, it was caused by a failed component covered by the warranty, not by the owner 's failure to maintain adequate coolant level. Lender still has not established the cause of engine failure yet denying the claim for engine repair over the phone. 
3 ) Lender denying claim accusing owner 's negligence. There is no way a Lender can conclusively determine that the engine overheat was due to owner negligence. The vehicle the Lender sold me, 2010 BMW 650ci, is not equipped with an engine temperature gauge for the driver. There is no way to monitor whether engine is over heating other than vehicle warning lights. No warning light of any kind on engine overheating or to stop driving ever came on. In fact, the caution light that came on was for " coolant low '' and to `` drive moderately '', which completely contradict the basis of the claim denial. 
The predatory lender is acting in bad faith in performing according to the terms of the loan. 

ref : CarMax Claim # XXXX ; Contract # is last XXXX digit of XXXX : XXXX

Company response to consumer: Closed with explanation