Should you buy a certified pre-owned vehicle?

Your choice for a better used car?

If shopping for a regular used car, whether it be at a dealer or private party, just isn't cutting it for you, there may be a better solution – choosing to buy from a new-car dealer who also operates a Certified Pre-Owned (CPO) used car program. These programs are operated jointly by the manufacturer and the dealer, and practically guarantee the quality, condition, and future long life of the car, truck, crossover, or SUV you're interest in.

Here are the latest CPO program award from IntelliChoice:

  • Best Popular CPO program: Kia
  • Best Premium CPO program: Volvo
  • Best Popular CPO warranty: Kia
  • Best Premium CPO warranty: Volvo
  • Best Popular brand used ownership costs: Buick
  • Best Premium brand used ownership costs: Cadillac

Nearly every brand sold in America offers certified pre-owned vehicle programs, including every division of Chrysler, Ford, General Motors, Honda, Nissan, and Toyota. Among the few exceptions are the small, exclusive or exotic brands such as Lotus and Panoz.

It's in the dealer's and the manufacturer's best interest to find the best used cars available for these programs, so most of the cars sold through them are clean, undamaged cars coming off of two- or three-year leases or out of rental-car fleet service. Restrictions on which vehicles are allowed in the program, such as age and mileage, vary.

Inspection and Warranty

Although the content and extent of each brand's certified pre-owned program varies, one of the constants is the complete vehicle inspection offered by every program. Though the number of items – or points – inspected on the vehicle varies from 100 to 300, as a consumer you should feel comfortable knowing that everything important on the car was inspected by the dealer, under the guidelines of the manufacturer, and the worn or bad parts were replaced, if necessary, before the vehicle was put into the program.

Aside from the inspections, the length and coverage of the certified-vehicle warranty also varies from program to program, and the buyer should make absolutely sure that the original manufacturer is offering the warranty, as opposed to a third-party or extended-warranty company. Depending on a vehicle's age, condition and mileage, it may in fact be cheaper to buy an uncertified used car from a dealer and then purchase a separate extended warranty for the vehicle.

The CPO bumper-to-bumper warranties can be a bit complicated, so be sure to do your homework and become familiar with all the ins-and-outs. Some of the warranties start when the car is sold to you, and some warranties start from the date of the original sale or in-service date of the vehicle, but are extended up to six years or 100,000 miles. Certified used car buyers should be sure to read and understand every paragraph of the vehicle and powertrain warranties offered with the vehicle so there are no surprises later.

Some warranties also require the buyer to pay a predetermined deductible amount for each repair; some don't. Some CPO warranties are even transferable to the next owner after you, which may be an attraction when it comes time to sell it. In most cases, the original long-term powertrain and corrosion penetration warranty will still apply.

You Also Get Perks

Beyond the usual vehicle inspection thoroughness and the length of the certified-vehicle warranty, the various manufacturers and dealers offer a large menu of extras on their certified pre-owned vehicles as enticements to a deal.

What if you buy a CPO vehicle, load your kids into it, and it stops running halfway to grandma's house? Most programs offer 24/7 roadside assistance for such situations on a CPO vehicle. Some offer temporary vehicle loans while your vehicle is being repaired. Others go even further than that, offering trip interruption insurance that will pay you up to $1500 dollars toward your living expenses while your CPO vehicle is being repaired and/or partial reimbursement for a taxi, shuttle or rental car during the repair period.

What if you sign on the bottom line, take the vehicle home, and nobody likes it? Some companies offer a no-strings return policy after three days or 150 miles of home-based test driving. Others offer special financing rates on CPO vehicles to make the deal as attractive as possible. Another potential deal-sealer is a free CarFax report on the car before you buy it. A few CPO programs include the Carfax Buyback Guarantee as well.

Still other goodies could include free lock-out service, free car washes on each warranty visit, and preferential treatment in the service queue. Others offer free trip routing and maps. It's all there, in the fine print.

Is It Worth It?

Due to the costs involved in the inspection, certification and warranties process, a certified used car will almost always be more expensive than a normal used car or one from a private party out of the classifieds. How much more? From two to eight percent higher, according to Kelley Blue Book research. Premium-brand vehicles will be priced even higher because there are more items to warranty on a luxury car than there are on a basic Chevrolet or Ford.

But, look at it this way: You can get a thoroughly inspected and guaranteed, slightly used two-to-five-year-old vehicle for far less money than you'd have to pay for it new. Add to that attractive interest rates, with lots of extra perks in the deal, including the security of a longer warranty.

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