So a friend’s recent purchase, and subsequent repairing of, a certified used vehicle left me with a lot of questions. Questions I thought might be great to find the answers to and then share with all of you, in fact. Questions like, “what does certified pre-owned even mean,” or “what types of certifications are there,” or “why did a certified vehicle need to be repaired so quickly after purchasing?” I have to tell you, the answers are quite interesting. And just for those wondering, my friend’s recent purchase was a dealership certified vehicle, and the repairs were cheap.
There are three different types of certification processes. One type is Manufacturer, also known as Factory, or Certified Pre-Owned. A factory CPO vehicle tends to have the strictest of certification processes of the three. The second is certified in an independent program. Like you would expect, this one is normally the second strictest, though what it focuses on can vary from agency to agency. The final is a dealer certified program, where there doesn’t necessarily need to be a certification process at all. All three have their pros and cons, and it’s worth taking a look at each to see which is best for you.
So first mentioned was the Manufacturer’s Certified Pre-Owned program. From this, you can expect the car to have been run through a rigorous inspection determined by the original manufacturer of the vehicle. The manufacturer also makes sure the vehicle doesn’t exceed a certain mileage, most commonly around 80,000 miles. The car must also be in a certain condition, namely within five years of its release year. You will also find that the vehicle will have any needed repairs finished. The tradeoff of this is that the buyer is more likely to pay more for the car through a factory-certified pre-owned dealership than otherwise. Typically, though, the buyer of a certified pre-owned vehicle will find a lessened risk of serious car problems down the road, but like most things in life, nothing is certain.
Next are the independent agencies and their own certification processes. Because of their independence, they can run a vehicle through a more stringent test than the original manufacturer, or, if they so choose, a less stringent inspection. Their certification programs tend to be cheaper than an OEM program, which is basically the factory CPO process. This makes the car a bit cheaper as well. Independent brands include the National Vehicle Certification Program, Carmark, as well as others.
Like I already mentioned, a dealer certified pre-owned vehicle tends to not usually be a certification at all, rather they offer an extended or aftermarket warranty. An Edmunds.com article explains that this isn’t necessarily a bad thing; it just means that the vehicle isn’t actually certified. It also explains that these extended warranties and aftermarket warranties aren’t really even warranties, either, in the strictest sense of the word. They more closely resemble service contracts, since a warranty is included in the price of the product; they’re not an additional cost or sold separately. Dealer certified vehicles tend to be the cheapest of the three, with the only additional cost being the extended or aftermarket warranty.
After all that, it simply comes down to what you can afford. It’s important to note that I don’t just mean on the initial cost of the vehicle. For instance, a Factory CPO may be more expensive, but you’re less likely to break down a couple months or so after purchasing the vehicle. On the other hand, Dealer Certified vehicles tend to be cheaper, even with an extended warranty, but what shape is the car in? How much can you afford in repairs if the car breaks down two months after you purchase it? What exactly is the independent certifying agency covering in their inspections? Simply put, what can you afford?