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Are Certified Pre-Owned Cars Worth It?

cpo worth it 2 2 jpg Cars.com illustration by Paul Dolan

Certified pre-owned programs have offered a premium echelon in the used-car market since their emergence in the 1990s. CPO cars, as they’re called, get multipoint inspections, vehicle history reports and sometimes modest refurbishing. The programs bundle in other perks, too: extended warranty coverage, roadside assistance, discount financing offers and more. You might see “certified” thrown around to mean something less in the fine print, but automaker-backed certification typically comes on late-model used examples sold by dealerships of the same brand.

Related: Can You Negotiate Price on a Certified Pre-Owned Car?

Naturally, CPO cars usually cost more than their non-certified counterparts. A Cars.com analysis on more than 670,000 late-model used examples of 26 popular brands pegged the average advertised price for CPO examples at $30,650, versus $29,444 for the same models with no certification. That’s a premium of $1,206, or 4.1%.

Is that $1,206 worth it? Automakers would have you believe so, touting features like low mileage and extended warranties that usually command a premium or have to be purchased as an add-on for non-certified used cars. However, placing a dollar value on the CPO treatment is a calculus fraught with variables. We’ll explain.

Certified pre-owned programs have four main benefits:

1.  A better car to start with: Of the used-car population, automakers generally certify only a subset that meets given criteria.

2. An extended warranty: CPO cars come with extended warranties you won’t get on any ordinary used car without paying extra.

3. Special financing: Automakers often give CPO models discounted financing rates more akin to their new-car financing incentives.

4. Extra perks: From satellite radio to roadside assistance, other perks abound.

How much is each of these worth? Let’s break them down.

Benefit 1: A Better Car

Generally speaking, CPO cars have limits on age and condition; non-certified used cars don’t. Programs used to generally cap acceptance at cars 5 to 6 years old with a maximum of 85,000 miles. However, some popular automakers (including Ford, Honda and Nissan) have bumped that age limit up to 10 years, with Ford certifying vehicles with up to 150,000 miles. Many brands stipulate that CPO vehicles must have a clean title, which is to say it hasn’t been rebranded due to a major accident, environmental damage or other dubious history.

All CPO programs put vehicle candidates through rigorous inspections, often with 100 or more inspection points, requiring repairs for anything that fails. Avoid dwelling on the number itself, though, as points can be as cursory as whether the horn works, and keep in mind that a given component doesn’t need to be new to pass inspection. Brake pads, for example, might pass if they still have a minimum grade of useful thickness.

In sum, the CPO pool should help you avoid cars of questionable background — but that’s not to say non-certified cars automatically have elevated risk.

What It’s Worth

The value of the selection process depends on how much work you’re willing to do yourself. You can approximate similar qualifications with appropriate scrutiny:

  • Search only for used cars that fit the age and mileage boundaries imposed by their respective brand’s CPO program. Compare such criteria among most brands here.
  • For any prospective car, get a vehicle history report from a leading provider, such as Carfax or AutoCheck, that shows no red flags.
  • Scrutinize the car with a thorough in-person inspection and test drive.
  • For cars that pass all of the above, finish with a professional pre-purchase inspection from a reputable independent mechanic in the area. Such inspections can range widely, but you should insist on an engine compression test and frame-rail inspection, among other items. If the seller doesn’t let you take the car for an inspection, that’s cause for concern.

Depending where you live, the steps above might cost $100 to $200 and a few hours of time, and you may need to embark on the process more than once if it reveals any deal-breakers.

It also bears reminding that there’s no way to fully eliminate the risk of buying a problem car. This is all about improving your odds; CPO vehicles can save the trouble of going through the process above, but such programs make no guarantee of problem-free ownership. We still recommend test-driving any used car you plan to buy, CPO or not, and the most risk-averse shoppers may still want to secure a mechanic’s inspection for a CPO car.

Benefit 2: An Extended Warranty

What your efforts can’t buy is the CPO warranty. Programs typically furnish comprehensive (often called “bumper-to-bumper”) coverage from the time you buy a CPO vehicle to one year or 12,000 miles past that, whichever comes first. If your car is still within its factory comprehensive warranty, certification programs typically tack this coverage onto the end.

Separately, most CPO programs furnish a longer warranty for your powertrain, which includes the engine and transmission, that extends in most cases to 100,000 original miles and six to 10 years from when the car was new.

Both policies carry significant value combined, but myriad variations exist. Some luxury brands, such as BMW and Lexus, offer a combined CPO warranty that includes powertrain coverage; Nissan, by contrast, furnishes only powertrain coverage. Pay attention to the deductibles paid per visit, even if the repair is covered by warranty. Some brands have zero-deductible CPO warranties; others impose a fee.

What It’s Worth

Extended warranties are often the highest-value item in a CPO program. They’re also the most straightforward to compare against stand-alone extended warranties — often called service contracts — though the two may not line up exactly. Find out what’s covered in both, keeping in mind that no warranty will cover everything.

You should have plenty of stand-alone alternatives to choose from. Automakers, dealers and even third-party companies sell extended warranties, but specifics vary, especially when it comes to who services the contract. CPO warranties are typically backed by the automaker, which means any participating dealership can perform repairs. Stand-alone extended warranties furnished by the automaker usually carry similar backing, but that’s seldom the case for warranties furnished solely by the dealer or a third-party company. Such policies may cost less than a factory extended warranty, but read the fine print: Only the facilities contracted into the policy or the dealership that sold it to you might cover its services.

Few brands display prominent pricing on factory extended warranties and specifics will vary based on the vehicle, age and location, so you’ll want to ask your dealer for details. As with any item on a vehicle purchase, you can always negotiate the price and terms of your CPO warranty with the dealership. The powertrain portion of a CPO warranty is a separate matter. Many providers offer powertrain-specific extended warranties, which are typically priced below bumper-to-bumper warranties because they cover less. Get a quote or two for your prospective car, and it should help value that portion of the CPO warranty.

Benefit 3: Better Financing

About a third of all used cars are financed, per Experian, and many of those buyers probably wish their loans had lower interest rates. In the second quarter of 2024, Experian reported finance rates for used cars of all types averaged 12.01% versus 6.84% for new cars. That’s despite used-car loan terms being slightly shorter (67.41 months on average versus 68.48 months for new cars) and lower (an average $26,248 financed versus $40,927 for new cars).

CPO programs can help bridge the gap, as they often offer low-interest financing closer to the plum rates on new cars. It’s likely that only the most creditworthy shoppers will qualify for such loans, but the closer you can get to new-car interest rates, the more it can save over the life of the loan.

What It’s Worth

Gauging how much a low-interest loan saves is complicated. On a five-year loan for $20,000, the difference between Experian’s average rate in mid-2024 for a new car (6.84%) and a used car (12.01%) amounts to an enormous $3,028. But you shouldn’t take those savings at face value. For starters, a big reason used-car loans have higher interest rates is that they cater to shoppers with lower credit. In the second quarter of 2024, new-car shoppers had an average credit score 64 points higher than used-car shoppers, according to Experian.

While you’re unlikely to see as stark of a difference between a CPO loan and a non-certified used-car loan that you qualify for, a CPO loan might come in a reasonable amount lower, especially if you secure the advertised rate. In the scenario above — a $20,000 loan financed over five years — moving from 6% down to 5% saves $554 over the life of the loan. Moving to 4% saves even more at $1,099. That’s nothing to sneeze at.

Again, those savings may not add up at face value. Typical new-car incentives offer you the largest cash discounts or lowest-rate financing as separate deals, but not both. Used cars lack fixed prices, so CPO vehicles seldom advertise cash discounts, but securing a low advertised finance rate might mean the dealership budges less (or not at all) on the negotiated price. If dollars saved on the financing side come at the expense of dollars not saved on the vehicle price, an honest assessment must account for that.

Confused? The point is this: Discount financing on a CPO car could save serious money, all other things being equal. You just need to take into account all of the other deals or financing offers on non-CPO cars you could be forgoing to get that rate when you consider the negotiated price of the car.

Benefit 4: Other Perks

Beyond the core benefits of buying CPO, automakers throw in myriad other perks that can include:

  • Satellite radio: SiriusXM allows dealers in its program to activate a three-month trial on CPO vehicles once they’re sold. (Unsurprisingly, most CPO programs we surveyed offered three free months of satellite radio on cars equipped for it.)
  • Roadside assistance: Many brands throw in roadside assistance for a year or longer on CPO vehicles.
  • Free maintenance: Some brands add in complimentary maintenance. For example, Honda covers the first two oil changes after purchase; Acura covers the first scheduled maintenance visit; and Lexus covers up to four maintenance visits.
  • Telematics: Some brands furnish a trial period of complimentary telematics service, which enable connected-car features such as internet connectivity and emergency services. For instance, Acura includes three months of AcuraLink, while Chevrolet includes a one-month free trial of its OnStar Premium Plan.
  • Return policies: Some automakers’ programs have options to return the vehicle within a few days if you don’t like it — three days for GM’s vehicles or seven days for Mercedes-Benz, for example. Mileage limits typically apply to these return policies, however, so don’t expect to take it on a cross-country road trip before returning it.

What It’s Worth

Many such perks involve immediate, tangible benefits — you can’t get Yacht Rock without an active SiriusXM subscription, after all. But the extras have determinable value: Three months of in-car SiriusXM is worth roughly $30 to $75 in total, depending on the package, and two free maintenance visits might save you $100 to $150, depending on the car. Roadside assistance is often offered by your insurance provider, credit-card company and other third parties, such as AAA. NerdWallet values it at $5 to $100 per year, depending on specifics. One month of GM’s OnStar connected-car services is worth anywhere from $15 for the bare-bones emergency services-only Guardian Package to $49.99 for its full-feature Premium Plan that includes data for streaming and in-vehicle apps along with emergency services.

All of those perks might add up to a few hundred dollars, but only if you’d planned to purchase them individually in the first place. If you don’t intend to listen to satellite radio, it’s worth comparatively less. If most of your past oil changes were purchased with coupons, two free maintenance visits probably aren’t worth $150. You get the idea.

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Adding It All Up: What Matters to You

Automakers sold 2.65 million CPO cars in 2023, by Automotive News’ tally. That’s only a fraction of all used cars sold. Unfortunately, as CPO programs have grown in popularity, pandemic-era inventory shortages of new cars has meant there are fewer late-model cars available that qualify.

Does it still make sense to shop for the perfect CPO deal? For shoppers who value each benefit listed above or who want the peace of mind guaranteed by CPO programs’ extra pre-purchase checks, paying an extra 4.1% for a CPO car can make sound financial sense. Conversely, shoppers who see little to no value from those benefits may have no reason to buy certified. We suspect most shoppers fall somewhere in between. If you find value in some parts but not others — the warranty but not the inspection, for example, or the financing but not the extra perks — then it’s worth assigning individual value to each benefit to assess the total value of a CPO program against your needs. Add it all up, and you should have a pretty good idea of whether buying certified is worth it.

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Cars.com’s Editorial department is your source for automotive news and reviews. In line with Cars.com’s long-standing ethics policy, editors and reviewers don’t accept gifts or free trips from automakers. The Editorial department is independent of Cars.com’s advertising, sales and sponsored content departments.

Kelsey Mays
Former Assistant Managing Editor-News Kelsey Mays likes quality, reliability, safety and practicality. But he also likes a fair price.
Email Kelsey Mays

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