When it comes to buying a car, deciding between a “certified pre-owned” (CPO) vehicle and a regular used car may require careful consideration. Each option has its advantages and disadvantages to explore, both of which can affect not only your finances but also your confidence in your purchase. Keep reading to learn more about the benefits of CPOs and how to make an informed decision as a used car buyer.
Benefits of Choosing a Certified Pre-Owned Car Over a Regular Used Car
As the price of new cars continues to increase, some Americans may prefer to buy a car that has already been loved by an owner before. One of the benefits of purchasing a pre-owned car, whether certified or not, is the significant savings it can offer compared to purchasing a new vehicle. The main difference between a certified pre-owned car and a regular used car is that the latter can be resold through a private seller, and a CPO cannot. A certified pre-owned vehicle must be a used car that is thoroughly inspected and refurbished by industry experts. While this may increase the price, the buyer will receive the benefits of a used car that is clean, inspected, and likely in better condition.
Assessing the Value of CPO Warranties
Certified pre-owned vehicles are typically less than five years old. In some cases, they come with a manufacturer-backed warranty, which can give buyers added peace of mind during their purchases. These types of warranties cover repairs and maintenance for a set period of time, offering an extra layer of financial protection. Keep in mind that the value of these car warranties depends on preferences and the specific terms offered by the manufacturer.
Guidelines to Follow When Shopping for Regular Used Cars
Thorough research plays a huge part in shopping for a regular used car. However, before you start your search, it is important to establish a budget that works for you and determine what makes a particular model fit your taste, budget, and lifestyle. Once you have found a pre-owned car (not a CPO) that you like, take the time to obtain comprehensive reports on the vehicle's maintenance and accident history. Consider seeking advice from a trusted mechanic to ensure that the car meets your expectations and, most importantly, is in good working order.
The Potential Downside of Purchasing a Used Car
Despite their cost effectiveness, there can be several drawbacks associated with buying a used car from a private seller. These drawbacks can include the lack of warranties, uncertainty surrounding the vehicle's history, and the potential for future maintenance costs as the car takes on wear. In some cases, there is a risk of (potentially) catastrophic repairs later on. These are all factors that buyers should keep in mind during their search for a used car, despite the initial appeal of going with a pre-owned vehicle.
The Best Time to Buy a CPO
When it comes to buying a certified pre-owned car, the best time is often during seasonal sales events or at the end of financial periods when dealerships may offer incentives or discounts to meet their sales targets. You may even be able to negotiate a price decrease at the dealership when you are shopping around for a certified pre-owned vehicle! Put on your game face, research negotiation tactics, and head into the lion’s den. Research online title loans when thinking about financing, debt and equity.
The Advantages of Purchasing a Brand New Car
Opting for a new car comes with its own unique benefits. For one, being the first person behind the wheel gives you a sense of pride and ownership. Additionally, having control over the customization of your new car and all of its upgrades allows you to personalize the vehicle the way you want it! Therefore, your vehicle can be a reflection of your personality on four wheels. Moreover, new cars come equipped with the latest technology and safety features, ensuring you stay ahead of the pack. Lastly, there's no worry about wear and tear from previous owners or the possibility of having a haunted car on your hands like a certain Plymouth Fury Stephen King wrote about.
Ultimately, deciding between a certified pre-owned car and a regular used vehicle depends on your own personal preferences, budgetary considerations, and how it will best serve you in the future. By understanding each option and determining what makes the most sense, buyers can slide into the driver’s seat and leave uncertainty in the rearview mirror.
Aidan has been writing about personal finance for over 6 years. Prior to this, he worked as a Corporate Finance Analyst where he specialized in Due Diligence, Company Valuations and more. He is a CFA charterholder.
