While certified pre-owned cars seem like a relatively new phenomenon, they first made their appearance back in the 80’s when Mercedes-Benz began selling them. Buying a used car can be a daunting prospect for many—fears of expensive lemons are certainly legitimate. But, there are lots of great used cars out there, you just have to be smart about the purchase to minimize your risks. Buying a certified pre-owned car can be a great way to go if you don’t have the cash or desire for a brand new car, but have a bit more money to work with. Here are some things to know about certified pre-owned (CPO) vehicles.
What are CPO Vehicles?
CPO vehicles are later model used cars that have either been certified by the manufacturer or the dealer. It has been inspected, and any issues fixed. The former type of certification is the most important one to look for, as this comes with a warranty that comes at no additional cost to you and offers the same coverage as if you bought a new car. Manufacter-backed warranties also mean you can have the car serviced at any dealer in the country.
Dealer-certified vehicles come with a dealer-backed warranty, but usually at an additional cost. They also may not have been as thoroughly inspected as a car from a manufacturer program, which has very stringent standards.
Be cautious of any certifications from third party organizations—they often mean very little.
Do Your Homework on Price
Having a car be part of an ‘official’ certification program may give the sense that there is less wiggle room when it comes to negotiation, and you must pay whatever the stated price is. But, like any other car, the sale price is not set in stone. When shopping for a certified pre-owned vehicle, just as you would for a ‘regular’ used car, find out the specs of the vehicle, and check out sites such as Kelley Blue Book to get an idea of what the car is worth based on its mileage, condition, equipment and other relevant factors. Check used car ads in your region to see if you find similar vehicles and what they are being sold for.
One thing to keep in mind, however, is even though you can negotiate as you would with any other car, you might not have as much leverage. Quality used cars are in demand, and they are usually not as hard a sell as a ‘regular’ used car that is older, has more mileage, wear and tear, etc…
Verifying Its ‘Status’
When it comes to buying a used car, even one that has been certified, it is important you confirm for yourself the true condition of the car. Insist on seeing any records related to the vehicle, as well as the inspection checklist used for the certification. Make sure you review the warranty and that everything is clear—if you are unsure about anything, ask, don’t assume. Read the fine print. Certain types of coverage beyond the powertrain usually require an additional cost.
These are just a few of the core considerations. A CPO car can be a great investment if you want a newer vehicle without having to take that huge depreciation hit that occurs once you drive the car off the lot. But, like any other car purchase, do your homework.