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Orange County Credit Union provides a broad range of banking products and services like checking, savings, loans, and investments for every season of life. Through our blog, our aim is to equip readers with helpful advice that will enable them to reach financial goals.

What is a "Certified" Used Car?

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What is a "Certified" Used Car?

Sandra Diaz

You may have noticed "Certified" window stickers when you’ve visited a car dealership. It grabs your attention – you feel like you’ll be buying a trouble-free used car. Does "certified" really mean that you’ll get peace of mind? 

There’s no industry standard to determine what’s a "certified" used car. Any used-car dealer can say it. "Certified" simply means that a used car has been inspected so the seller can say it’s in better condition than the average used car. In general, certified used cars are less than five years old and have fewer than 60,000 miles. They may or may not be accident free, have a history of regular maintenance, need repairs, and include a warranty. The certification can be backed by the automaker’s certification program, referred to as factory- or manufacturer-certified, or by a third-party certification sold by the dealer. 

A factory-certified used car has had a rigorous, multipoint inspection by a certified mechanic, the dealer has made the necessary repairs, and certifies that the car is in good-working condition. It includes a manufacturer-backed extended warranty and may include some perks like roadside assistance, oil changes, or trial offer for satellite radio. The specifics of the extended warranty - what’s covered and timeframe - differ greatly from manufacturer to manufacturer. So, it’s important you read the contract! 

Be cautious of non-factory certified used cars. They don’t include a manufacturer-backed warranty, so you may run into problems if you need to make a warranty claim. It may include a service contract, but most likely it’s only good at the seller’s location. Plus, the inspection may be less rigorous and some, all, or none of the repairs may have been completed. 

You’ll pay a premium to purchase a certified used car – 2% to 8% of the price is added. Is the extra cost worth it? You may have peace of mind knowing that a detailed multipoint inspection identified potential problems so repairs are fixed before you buy the car. You’ll save time because the inspection and repairs are already done. Plus, if any future repairs are covered by the warranty, you’ll save money. However, there’s no data that suggests that certified used cars are more reliable than non-certified. Some experts even suggest that it might be better to save your money for rainy day repairs. Ultimately, there’s no guarantee that any car is trouble-free. 

Here are some questions to ask if you’re considering a certified used car.

  • Is the car factory-certified by the automaker’s certification program? 
  • Is the warranty from the manufacturer or a third-party? 
  • What does the warranty include and exclude? When does it start and end? Ask to see a copy of the contract. Read ALL of it! 
  • Where can I take the car for service? Do I have to come back to your location or can I take it to any same-brand dealership? What happens if I need service and I’m out of town? 
  • Can I see a copy of the inspection report? What repairs were done? 
  • Do you have a copy of the vehicle’s history information (i.e. CARFAX)?