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Used or CPO: Which option is right for you?

Posted on Monday, March 16, 2015 at 11:45:53 AM

Used-car shoppers have a new preference: certified pre-owned, according to This option has overtaken the traditional used car for buyers looking at something other than new, as CPO vehicles come with dealer guarantees of the car's condition.

However, there is no universal answer for which used vehicle is right for you. To help clarify this question, Home Loan Investment Bank's Christine Dikdan offered some crucial advice. She explained that you first need to decide which vehicle you want, and then choose used or CPO. For example, a CPO late-model luxury sedan could be thousands of dollars more than the used version of the same car. However, you'd have the dealer guarantee and maybe even a longer warranty or special financing.

"You will have the peace of mind that the vehicle has been thoroughly inspected, the needed repairs have been made and the vehicle is being backed by a factory warranty," Dikdan added. "As with anything, please read the 'small print and all print' as to what this actually means for the specific vehicle you are purchasing."

Furthermore, make sure you bring up any questions or concerns if they aren't addressed in writing. Take note that a CPO vehicle is likely to cost you more than the standard used option.

"You would typically have a higher initial purchase amount and therefore pay more upfront," Dikdan pointed out. "Like life in general, it's a gamble, because it could save you on the back end by not having to pay for repairs. Please always remember that many of these dealerships and salespeople work off of referrals. It is in the dealers' best interests to keep satisfied returning customers."

That is another pro in the CPO column. A few other pros include:

  • Factory-certified - A CPO will have a complete inspection by the factory and all repairs will be made. 
  • Warranty - With CPO, you may have a warranty just like a new car.

On the other hand, the key cons for CPO are price and inventory. They tend to cost more than a comparable used vehicle, and you have a greater selection by looking outside the CPO inventory. Keep these factors in mind as you continue your search for affordable auto financing and a used vehicle.