Explaining Certified Pre-Owned Cars

Certified pre-owned cars, like this BMW, offer car buyers peace of mind with lower milage and a clean history.

Every car buyer wants quality, whether they’re buying new or used. New cars offer a certain peace of mind: new features, no mechanical problems and an intact warranty. Used cars, however, cover a much wider spectrum. It’s more difficult for buyers to gauge the exact quality of a used car on the lot. That’s why some manufacturers have developed the certified pre-owned (CPO) designation.

What is a Certified Pre-Owned Car?

CPO vehicles are generally the best selections from a dealer’s used car inventory. These are late-model cars with low mileage, clean history and virtually no mechanical issues or cosmetic damage. Before hitting the lot, the vehicles undergo an inspection and reconditioning process to bring the car as close to pristine condition as possible. Most importantly, CPOs will generally have the backing of the manufacturer, not just the dealer.

Dealers will also bundle CPO vehicles with perks you would expect from a new car purchase. Depending on the manufacturer, this could include:

  • Better financing terms
  • Complimentary oil changes
  • Free roadside assistance
  • Free loaner cars

Certified Does Not Mean Certified Pre-Owned

Occasionally, you’ll see dealers try to capitalize on the elevated perception of a CPO vehicle. Seeing “certified” on the window sticker does not necessarily mean the car qualifies for the manufacturer’s CPO program.

Many times, dealers will use language that make it appear that the car is certified by the manufacturer when it is not. Asking to see the Carfax report is one of the best ways to verify certification, as it will be on the report as a CPO offered for sale.

What About Pre-Certified Cars?

Some dealers have come up with a way to advertise a car as certified when it really isn’t. They will tell you it’s “pre-certified.” This allows the dealer to advertise the car at a lower price than its competition on websites like Autotrader, Cars.com, and Car Guru. At first glance, it will look like you’re getting a great car without paying the premium of a CPO.

Don’t be fooled. This is only a tactic to get you in the door. When you visit the dealer, they will tell you the car “meets the criteria for certification” and “can be certified at an extra cost.” After that, they will present options for certifying the car versus simply adding an extended warranty. This is a lowbrow tactic and it’s used more often than people realize.

Are Certified Pre-Owned Cars Worth It?

CPO vehicles are priced at a premium compared to used cars with similar mileage and condition. However, their extended warranties and reconditioning mean that you shouldn’t have to pay for any major repairs for a few extra years. In addition, if you’re financing the car, a CPO will generally have a lower interest rate from the manufacturer.

In general, CPOs are a great buy if you’re looking at a late-model used car and have the capability to spend more up front. There’s always a chance you could find a used car that’s every bit as nice as a CPO vehicle, but the extended manufacturer’s warranty is beyond compare.

Take it from us: there’s no one-size-fits-all approach to car buying. Your financial status, life stage, and future outlook are all important things to consider before signing anything. These factors may even determine whether you should buy or lease.

Let us walk you through it. Our car buying experts will advise and negotiate your deal from start to finish. You’ll save time while getting a great deal on your next car. Drop us a line today to get started.