Both certified pre-owned (CPO) cars and regular used vehicles can be a better choice when you're dealing with bad credit, but they're not the same. While they’re technically used, CPO cars go through a different pre-sale process than traditional used vehicles and include some added perks.
Both certified pre-owned cars and regular used vehicles have benefits, so which one is best for you may not be best for somebody else.
Used cars gain the CPO title by going through a manufacturer’s certified pre-owned inspection program and meeting all its requirements.
A certified pre-owned vehicle, or CPO, is one that has been inspected and certified by a manufacturer-certified mechanic.
As long as the vehicle is in good condition both inside and out, is less than five years old, meets the mileage requirement, and passes a manufacturer-specific inspection, it’s eligible to become a CPO car.
Keep in mind that each automaker has its own specific CPO vehicle programs and inspection processes.
CPO cars also come with some form of manufacturer-backed extended warranty, which is something traditional used vehicles can't claim. If you want one of those, you usually have to purchase it separately.
The automaker-backed extended warranty of certified pre-owned cars typically starts from the vehicle’s original in-service date. Plus, many CPO programs offer roadside assistance, satellite radio trials, and free maintenance.
The downside is that because of all these perks and the warranty, CPO cars generally cost more than regular used vehicles.
Traditional used cars are just what they sound like: they’re used vehicles on dealer’s lots that don’t receive the inspection required by a manufacturer. Used cars typically get inspected, however, so don’t think you’re buying an unreliable model just because it hasn’t been manufacturer-certified.
Even though a regular used vehicle doesn’t go through the same inspection program as a CPO car, it doesn’t mean they’re worse. However, to get the same kind of detailed inspection, you would need to have a certified mechanic look over a vehicle on your own dime.
In addition, used cars aren’t usually covered by a manufacturer-backed warranty. This means you’re responsible for deciding whether or not you want an extended warranty and paying for it out of pocket.
There are several points that separate a CPO from a standard used car. Here are a few things to know.
Though a CPO and a standard used car are both pre-owned vehicles, CPOs go through a rigorous inspection that standard used cars just don't get. The key difference between this process for a standard versus a certified pre-owned vehicle has to do with the mechanic inspecting it. Some mechanics are certified by specific manufacturers as specialists for a specific brand. The inspection process for a CPO is much more thorough than for a standard used car.
If a vehicle doesn't pass muster on certain aspects of the certification, it may be reconditioned to bring it back to a condition that's closer to the original.
When you're looking into a CPO, you're looking at a used car which is typically less than 5 years old and usually has less than 60,000 to 80,000 miles on it. A standard used vehicle, on the other hand, is typically less than 10 years old and may have less than 150,000 miles on it.
Perhaps the biggest difference between a used car and a CPO is the "certified" designation. This means that the vehicle is up to brand standards, and also comes with a limited warranty. The warranty is the largest qualifier for what makes a CPO worthwhile, since standard used cars don't come with one.
When it comes to used cars, both standard and CPO vehicles are going to cost less than brand-new cars. However, a CPO will still cost more than a used car in most cases. There is no hard and fast example of this since each vehicle's price depends on many factors such as age, mileage, condition, and location.
However, a good rule of thumb is to expect a CPO to carry a price tag between $2,000 and $5,000 higher than the same, non-certified vehicle. much of this difference in price has to do with the certification inspection, and the warranty issued on the vehicle.
The pros and cons of buying a certified pre-owned vehicle are much like the pros and cons of any car purchase. Here are some things to consider:
Pros:
Cons:
Standard used cars come with their own set of pros and cons to be aware of.
Pros:
Cons:
Deciding which type of used car is right for you is a personal choice. Many times it comes down to whether you need to save money upfront, or if you'd rather have a bigger residual value from your vehicle.
It may also come down to finding the right vehicle for you. Sometimes, the vehicle you need isn't available as a CPO, so going with a used car is still an option and vice-versa.
The first thing you should do is look at your credit and your down payment amount. Going into a car-buying situation prepared allows you to have a better understanding of what you may qualify for. If your credit is particularly low, you may have issues getting approved for a newer vehicle, like a CPO.
No matter if you buy a CPO vehicle or a traditional used car, finding financing with bad credit isn’t easy. Luckily, we’re here to help you get connected to a dealership that has the lending resources you need.
At Auto Credit Express, we’ve been helping credit-challenged car buyers get the financing they need for over 25 years by connecting them to the right dealer for them. All you need to do to get started is complete our free and quick auto loan request form. Don’t wait any longer, get started right now!
Senior Automotive Financing Editor
Meghan is expertly versed in automotive special financing and pricing analysis, having published hundreds of articles on Auto Credit Express and its sister sites, CarsDirect, and The Car Connection over the past decade. She began her career as a sports writer for the local newspaper in her hometown nearly 30 years ago, and has enjoyed writing ever since. Read more
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