What is a certified pre-owned car?

What's the difference between certified pre-owned and used cars?

A certified pre-owned car (CPO) is a used car that the manufacturer or dealer backs via its CPO program. Each company has different requirements for qualifying a CPO vehicle, including mileage and condition. Manufacturer-backed CPO vehicles may include an extended manufacturer's warranty. If you're interested in purchasing a certified pre-owned vehicle, check whether it's manufacturer or dealer-backed, and what their particular CPO program includes.

CPOs are used cars, but not all used cars for sale are CPO. A mechanic has thoroughly inspected a CPO vehicle and made repairs if needed. They might come with a warranty, so you'll likely pay more for a CPO car than a non-CPO-used car. CPO cars won't necessarily have fewer problems than other used cars, but a CPO certification can give you peace of mind that the vehicle has been inspected and comes with some guarantee.

A CPO vehicle can cost significantly more than a non-CPO used vehicle. If you find a used car from a seller you're comfortable with, you could take the used car to a trusted mechanic for a full inspection. An inspection won't give you a guarantee, but it might alleviate your concerns without adding the cost of a CPO.

Are there advantages to buying a pre-owned car?

Purchasing a CPO has several benefits:

• Extended warranty: Many CPO vehicles come with a warranty, direct from the manufacturer, for certain repairs and services.
• Vehicle history report: For CPO vehicles, the dealership often provides you with a vehicle history report which includes the car's service history and information about previous accidents.
• Complete inspection: The manufacturer of a CPO vehicle often requires a thorough inspection by a mechanic to fulfill certain CPO standards set by the manufacturer.
• More financing options: Buying a used car from a private seller often means paying for the vehicle upfront. In contrast, dealers that sell CPO cars typically offer financing and leasing options, or you can find your own financing via a private lender.

Will a certified pre-owned car impact your insurance?

Your auto policy's rate typically changes when you switch vehicles or add a car to your policy, regardless of if the vehicle is new, used, or certified pre-owned. Whether or not your rate increases or decreases depends on your pre-owned vehicle's year, make and model as well as your coverage selections. For instance, if your pre-owned vehicle isn't financed or leased, you aren't required to carry comprehensive coverage and collision coverage. Find out more about the factors impacting your rate for auto insurance.

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