Are certified pre-owned cars a good deal?

Certified pre-owned (CPO) programs can be a win-win situation for car dealers and their customers. Designating vehicles as certified lends an aura of quality that helps dealers sell used cars—typically late-model vehicles that come off leases. And certification gives buyers confidence they’re not buying other folks’ headaches.

Nearly every automaker has a certified pre-owned program with two features in common: a multipoint inspection protocol and a CPO warranty. The inspection is supposed to reveal serious damage that disqualifies a car from becoming a certified cream puff, as well as any malfunctioning or worn items that need attention before the car goes on the sales lot.

But that’s where similarities between automaker programs end. As the saying goes, the devil is in the details. Consider these differences:

What do certified pre-owned warranties cover?

Certified pre-owned warranties may not be as comprehensive as a new car’s bumper-to-bumper warranty, which covers almost all components. BMW’s CPO warranty, for example, has a long list of exclusions, from ball joints to upholstery. On the other hand, Chevrolet says that its CPO warranty covers “almost every part of our vehicles.” Chevy excludes items that are normally considered “maintenance and wear” components—batteries, tires, and brake pads and rotors—as do most automakers.

Are there any deductibles for certified pre-owned cars?

While new-car warranties generally have no deductibles, some certified pre-owned warranties require you to pay a portion of a warranted repair. If your CPO Toyota requires a repair, you’ll pay a $50 deductible. If it’s a CPO Ford, you’ll pay $100.

Are there limits to the certified pre-owned warranties?

Some automakers make deceptive boasts about the length of their certified pre-owned warranties. “[It] can provide up to six years of warranty coverage,” says Lexus. Is Lexus’ used-car warranty longer than its four-year new-car warranty? It is not: Lexus has a two-year CPO warranty that adds whatever time remains on the new-car warranty. So, unless you become the second owner of a car within a few weeks of when it first sold as a new car, you won’t get anything like six years of coverage.

The Lexus two-year warranty with unlimited mileage is generous as certified pre-owned warranties go. Other automakers are stingier. For instance, Jeep’s is three months and 3,000 miles, although CPO Jeeps also get a powertrain-only warranty (covering the engine, transmission, and driveline) for seven years/100,000 miles beyond the new-car purchase date.

What are the certification requirements for pre-owned cars?

Vehicles eligible for certification vary by brand. A Ram pickup must be five model years or newer with fewer than 75,000 miles. But Bentley allows a dealer to certify a car up to 10 years old with no mileage limitation.

How important are the points in a certified pre-owned inspection?

The number of points, or items, covered in a CPO inspection is irrelevant. One automaker might consider brake pads and rotors as two points, while another considers them a single item. What truly matters is how diligently a dealer’s technician follows the automaker’s prescribed inspection.

Is it worth it to find a certified pre-owned car?

Some automakers may juice up their certified pre-owned programs with free stuff: maintenance, loaner cars, a satellite radio subscription, or the ability to transfer CPO coverage to a subsequent buyer for free. An automaker also may offer special finance rates.

Keep in mind, however, that certification adds cost to a used car. A 2020 study of more than 200,000 late-model used cars by the auto website cars.com found that, on average, CPO cars cost almost 5 percent more than non-CPO vehicles. So carefully study the details of a CPO program on the automaker’s website and then decide if it’s worth paying extra for a CPO car.

AAA Automotive Correspondent Peter Bohr has been writing about cars for more than four decades.