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Certified Pre-Owned Pros and ConsDuring these hard economic times, credit is a lot harder to get than it used to be. Shoppers who would ordinarily have searched for a new car might no longer qualify for a loan of that size. Fortunately, they have a less-costly alternative: the Certified Pre-Owned (CPO) car.Regular used-car buyers also are tempted by CPO vehicles, which reduce some of the inherent risk. No used car is perfect, but certified models undergo a comprehensive, point-by-point inspection. Certified Pre-Owned cars also include warranty coverage.Some people simply won't be satisfied with anything that's not new. Others are wholly content with used cars.
They're willing to take on the possibility of dealing with a few problems. Pro: Certified cars produce 'peace of mind'A sense of security is the main attraction of purchasing a Certified Pre-Owned model. Like new-car buyers, folks who drive home a certified used car shouldn't have to worry about breakdowns and costly repairs. Although it's secondhand, the certified used vehicle is a late-model that's been inspected prior to certification.Nearly all manufacturers offer a, backed by the factory. Other programs are established by the dealer or another organization, without factory sponsorship. Some include a vehicle history report from CARFAX or AutoCheck, which provides details on past accidents, and prior ownership.
Pro: CPO cars are pre-selected and inspectedFactory certification programs, backed by the car's manufacturer, have limits on age and mileage. Depending on the automakers, cars eligible for certification must be no more than four to six years old, with a maximum of 50,000 to 80,000 miles on the odometer. Toyota stretches eligibility to seven years, and Porsche to eight.Dealers follow a checklist of inspection points: typically, 100 to 160. Because they count those spots differently, the exact amount isn't important. You just want to know that the inspection has been comprehensive.When inspection reveals significant problems, repairs have to be made. For that reason, dealers would rather pick the 'cream' of the lot for certification. If the car is found to be in good condition as it stands, little additional investment is needed to turn it into a Certified Pre-Owned model.
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Pro: Certified-car repairs are covered through warranty periodCPO vehicles include a manufacturer-backed warranty that typically covers repairs for a specified time period after the original factory warranty expires. Con: Certified used cars cost moreInspection costs money. So does making any needed repairs.
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Dealers may also pay a fee to the manufacturer to participate in a Certified Pre-Owned program, and the warranty has a price.As a result, CPO cars are more expensive than a comparable non-certified model. How much more does a certified vehicle cost?
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For a low-budget model, the price difference might be only a few hundred dollars. For a luxury car, it could be several thousand. Larger non-luxury cars might have a certification premium above $1,000. Kelley Blue Book adjusts its used-car values to reflect the added cost of a certified model. To help ease the blow, Certified Pre-Owned buyers might be entitled to special financing, with more attractive terms. Con: It's still a used car, with potential for problemsNo matter how carefully it's been inspected, there's no guarantee that a certified used car will suffer no troubles over the next few years.
All certification can do is reduce the risk.