So if you’re wondering, what is the difference between certified pre-owned and the average used car? The answer is nothing much in terms of the fact that both are “used”. However, certified pre-owned is generally in better shape compared to an average used car since cars labeled as “preowned” has to pass strict standards. Also, certified pre-owned vehicles offer insurance which is important especially in second-hand vehicles.

Where are they from?

Certified pre-owned are mostly cars that were leased new instead of sold. And since it is leased, customers are expected to take care of the car to avoid extra charges for wear and tear at the end of the lease. It started in the 90s during the leasing boom when automakers needed to sell low-mileage, off-lease cars.

What will I get from it?

Most pre-owned programs have warranty, an inspection, and customers have the option to return the car if it does not satisfy him or her. This is the biggest advantage that any car buyer could have. Consider buying for the price of a used car with the warranty of a brand new car.

How does manufacturers make money out of it?

So far, it sounds too good to be true for the customers. What about the manufacturers? Manufacturers test and give warranty to certified pre-owned cars not because of charity but because of profit. With the traditional, lucrative trade of used cars, manufacturers make little to no profit. With the advent of CPOs, manufacturers and dealers now get a cut from the sale of each used car through the certified pre-owned tag. And the buyers pay for that.

So, is it worth it?

Certified pre-owned cars may sound like a bargain. But it’s not. It is, however, a smarter choice, a safer alternative, and a better purchase compared to an average used car. It is also considered as the third category along with used and brand new cars. So if you prioritize insurance, certified pre-owned is definitely worth your extra money. Consider the extra pay is worth the insurance that you will get your money’s worth. On the other hand, if you consider the price as compared to used cars, then certified pre-owned is not the best for you. You may take a gambl out of buying plain used cars, an option that is pretty risky for your hard-earned money.

]]> http://www.wisconsinpreowned.com/certified-preowned/automotive/is-pre-owned-worth-it/feed/ 0 http://www.wisconsinpreowned.com/certified-preowned/tips-of-the-day/no-nos-in-buying-a-car/ http://www.wisconsinpreowned.com/certified-preowned/tips-of-the-day/no-nos-in-buying-a-car/#comments Fri, 13 Jun 2008 07:00:27 +0000 Bob http://www.wisconsinpreowned.com/certified-preowned/tips-of-the-day/no-nos-in-buying-a-car/ Buying a car costs a lot. Making a mistake in buying one can cost you more. Whether you plan to buy a brand new or a used car, remember the following mistakes that most car buyers make:

Expressing your desire to lease before a price is agreed upon.

This gives you and the salesperson a topic to focus on. You may miss out on good deals that could have worked to your advantage. It is best to insist on negotiating on everything one at a time. Negotiate on new-vehicle price, trade-in value, and financing or leasing terms before you decide or express your decision.

Don’t be deceived by the deal.

There are many deals that automakers offer. This is an advantage to you. But remember that you are buying a car for its functions not because of the deal. A tight budget is not an excuse to fall for deals that may eventually lead you to bad choices and even graver budget problems.

Lack of preparation.
Most car buyers think of financing just when they are at the dealership. Remember that if you have a tight budget, knowing how much you have and how much you’re willing to pay can save you time, money, and effort. Check interest rates at banks or online financial sites ahead of time so you can have a clear comparison. The dealer may also offer good terms that could work to your advantage.
Not doing a test drive.
Test drive is very important. There are many brochures that have wonderful pictures of cars that may not have as wonderful engine. Many car buyers regret missing this single most important step in purchasing a car.

When you test drive, make sure to take your time. See to it that the car is everything you expected and leave a little room for surprises.

Not knowing the value of your car.
Lack of knowledge or research on the value of your car may cost you savings. Whether you trade-in or sell your car, make sure you know the used-car retail and wholesale prices. Once you know the value of your car, stick to it during negotiations.

Not consulting a mechanic.

You can never be too sure in buying a used car. You always have to see to it that you get a mechanic’s opinion. There may be irregularities that are not obvious during test drive or not written on paper.

Not double-checking the paperwork.

Owning a car is very exciting. But before you do one last thing, make sure you read the paperworks. Many car buyers end up complaining for not getting promised benefits only to find that none of it was written on paper.

So how old exactly is too old?
Let us first understand that a car is “commercially” old three years from the time it was produced or purchased. In fact, a new car is worth 60-70% less two-three years from the time you paid for it. Technically, a new car depreciates as fast as the “new” scent in your car disappears. This is true for brand new cars.

With used cars, it is more difficult to measure how old exactly is too old. First, because with used cars, what matters more than how long ago it was produced is how longer it will survive. Second, buying a used car is a bit of a gamble. There is no way you can tell if a car is too old to last longer than expected.
Since there are no hard and fast rules on how old exactly is too old for used cars, try the following tips so you can win over the gamble:
Do your homework – research.
This sounds boring but doing some research can save you time, effort, and money. You can visit forums on topics like this. By joining forums, you can ask for additional information, ask for some more tips, compare prices, and even learn from other peoples’ experiences on buying used cars. You can also find reviews, gas consumption data, consumer reports, and more valuable information through the Internet.
Narrow down your choices.
At this point, you should have at least two-three options in mind. It is important to narrow down your choice so you can test drive and compare these options.
Check car history.
This is as important as test driving the car. This is more like test driving in paper. Also, if you are still confused with your options, knowing the car’s history can help you pick the best one.
Find a mechanic.
Before you sign the papers, it will be wiser if you bring the car to a trusted mechanic. Advises on forums can be helpful for you to have an idea on which car to buy. But remember to not take hearsays as fact.
Double check all paperworks.
You can never be too cautious when it comes to paperworks. You may not be informed of a certain defect during sales talk so you need to read everything.

When you purchase your next car, consider the following features; these should make you much more comfortable on your long commute and provide you with the least expensive form of private transportation possible:

Transmission: What type of transmission do you want? This can be very important as you commute. If you drive long distances or if you have to deal with heavy traffic, having to change gears or worry about clutch maneuvers can be an unnecessary stress for you. With automatic transmission, these problems are no more. With stop and go traffic, you won’t have to change gears continually. Therefore, consider buying a car with automatic transmission when you shop for your next car.

Stereo mounted on your steering wheel: You can have stereo controls mounted directly on your steering wheel these days. When you want to adjust sound or change stations, these can be very handy. You don’t have to take your eyes off the road, so the less distracted when writing and thus are a safer driver. Ask your dealer about having stereo controls mounted in your steering wheel.

Gas mileage: One of the most important things that will impact your daily drive is the price you pay for gas. Therefore, gas mileage on your car is going to make a big impact on how much you’ll spend over time to manage that commute. Since gas prices are on the rise, your gas mileage will be an important factor. You should be able to make your daily commute and still have the amount you spend on gas stay reasonable. Make sure the car you buy has good fuel consumption.

Storage and cup holders: If you’re someone who has a cup of coffee on the way to work in the morning, make sure the car has conveniently installed cupholders. You need to have someplace convenient to put your coffee while you’re driving, so that you don’t spill it and can get out of your hands when you need to. You should also make sure to have room for anything extra, such as spare change, your parking ID, and so on. These types of extra amenities can make all the difference in terms of having a comfortable commute.

Noise reduction and good suspension for an easy ride: If your ride is noisy or very bumpy, this can be very annoying, and it can make long commutes torturous. If your car is able to give you a quiet and smooth ride, this will make your long drive much more comfortable. If your ride is particularly loud or bumpy, this can be a huge problem. When you test drive a new car, make sure you pay attention to the noise and the ride before you buy.

Electrical power points: Like many drivers, you probably have more than one electronic device that you take with you to work. If you need them to be operational while you’re driving, make sure that your car can handle all of this. For example, if you use a phone and perhaps computer while you drive, you’ll want a car that has enough power points to handle these things. Having power for all of your operational devices can make your drive more convenient and also safer.

The seats: Perhaps the most important but least considered feature of a new car are the seats it has. Make sure the seats of the car you’re considering have enough cushioning, and are comfortable to sit in. Make sure you can adjust them comfortably to fit you perfectly. They should also have adequate lumbar support. Some seats also have extra features such as extra heat, which can greatly increase your comfort in cold months. It can also help if you have a bad back so that the heat can provide soothing relief.

When you test drive your vehicle, make sure you take all of these features into account. Features can make all the difference between a car you’ll love and a car you’ll simply tolerate. You may regret it if you don’t take these into consideration before you buy.

Take your time.

Test-driving is not a test on you but on the car. Like physics exams, a car’s quality is based on how well it was researched, studied, and put together.

Your role as the professor is to check on the following things during test-drive:

§    Quality

You can check how the car looks on the exterior and think it’s pretty. But remember that a pretty car with a defective engine is no good at all.
You can check on the model and the reputation of the company that made it.
You will know if it’s a good car once you start driving it.

§    Necessity and Practicability

Does the car fit your lifestyle?
Do you have enough space in your garage for the car?
If you have a family, will the car be big enough or small enough for everyone?

§    Engine

Obviously, the engine is what keeps the car moving. Ergo, this is the most important part you need to check on. When it comes to engine, it is usually a battle of models and companies. More often than not, quality engines are from big car companies that have good reputation. This is because big car companies have better means for research and development on their brand and models.

§    Transmission

Does the car have a manual transmission? Check and see if it’s easy to shift. Does it do so smoothly? Is it stiff? Is there play that shouldn’t be there? If the vehicle you are driving is an automatic transmission, push the throttle down hard and then check to see if there’s extra passing power. Does it respond well? Does it hesitate on gears when you go uphill? How does it compare to other cars?

§    Noise

Noise can be a lot of things ranging from simple technical malfunctions to serious engine problems. So while test-driving, make sure you have your ears ready.

§    Handling

It may be difficult to check how well the car responds to quick maneuvers if you only drive it in short distance during test-drive.
However, you can try these basic tests:
Go to moderate speed around street corners. Does the car change directions easily?
Do abrupt lane change maneuvers. Are there any untoward movements or undulations when you maneuver the car?

The faster the car responds to your driving, the better.
§    Braking

Stop hard at least two or three times and make sure that the brakes respond properly. If the car has anti lock brakes, maneuver and stop at the same time. When you step on the brake, there should be some pulsing under your foot. This means that the ABS system is working well. If there’s too much pulsing, though, this means that the ABS system might not be as advanced as it should be.

§    Quality of ride

This is pretty subjective. But as mentioned, you’ll know a good car once you’re driving one.

Buying a car is an investment so make sure you invest on the right one. A simple test-drive can save you from regrets, accidents, and wasted money.

Through the Internet, searching for your ideal car is only a click away without leaving your home. With the Internet, you can virtually shop for a car by surfing through pictures, reviews, and other tools that will help you get the most reasonable price. This is a more practical way of going through your choices.

As compared to old school car shopping, wherein you will have to go through a dealership, take a test drive, discuss prices, and the list goes on. Most of the time, you will have to go through the same, long, arduous process for you to compare prices and quality with other dealers.

But you don’t have to go through all these with the Internet. Here, you can compare prices, features, models, and so much more with just a click on a mouse. You can also conveniently determine the trade-in value of your old car. And since there is a high competition between dealers on the Internet, the sky is the limit when it comes to your options. You can do all these while learning the basics through researching on the car you want. With the knowledge you acquire through the internet, you won’t be taken advantage of.

With the popularity of Internet shopping, dealers from across the country have added Internet sales departments that take care of online shoppers.

Wisconsin takes care of online shoppers through its highly trained Internet sales staff. However, if you don’t like engaging into business over the Internet, Wisconsin also has highly trained dealers whom you can transact with personally.

If you buy extended or extra warranties or service contracts, these will cost you more, whether for new or used vehicles. If you’re considering one, ask the dealer exactly what the warranty will cover if you need work done on your car. In addition, ask whether something is 100% covered or if some of the costs will fall to you. For example, if the warranty specifies the engine is covered, make sure you know just what it covers. Many of these warranties won’t cover things such as spark plugs or hoses, for example. In some cases, dealers even “split hairs,” in that if a part covered by the warranty is damaged by a part that is not covered, the dealer will no longer cover the supposedly warrantied part. So, for example, if a broken hose ruins the engine, then the engine itself is also not covered. In addition, a basic warranty will cover parts of the vehicle, but not such things as wear and tear related items, such as engine belts and wiper blades. You are responsible for these yourself and again, if they cause damage to a part that would normally be under warranty, then you also become responsible for the repair of the “under warranty” part.

Check with the manufacturer

Even though most vehicle warranties are standard, you should visit a manufacturer web site to tell you just what your vehicle warranty covers. You are also required to do certain things to keep the warranty valid. So for example, you probably can’t use a non-authorized mechanic to work on your car, or install or work on something yourself. If the part or work itself is not acceptable, the warranty may be voided and may become useless to you.

Got a manual? Read it

Read the owner’s manual that came with your car and find out what if any fees come with the warranty. Some of those “warranty” guarantees may actually have a deductible, just as your insurance coverage does. There may also be limitations, cancellation fees, and the like.

In addition, many warranties now come with “extras” such as free roadside assistance, help if you lock yourself out of your car, et cetera. In addition, your car’s tires will have a warranty by their own manufacturer, as will your battery. In addition, the emissions equipment should be covered for five years or 50,000 miles; this is a federal mandate.

If you’re buying a used vehicle, some of the original new-car warranty may still be valid. If the vehicle has not reached the mileage or time limit, you’re usually covered by whatever is left of the warranty. However, you shouldn’t assume and should always a check with the manufacturer.

Some used cars, especially those that are certified preowned, may also come with warranties specific to this type of vehicle. You should check them over thoroughly, as these are not standard and vary by dealership, area or state. Some places also offer prepaid maintenance or repair plans.

Your car’s condition

If your car’s condition is damaged, this decreases the value because Subaru dealers have to pay for reconditioning. It also means the Subaru dealer spends time and space making the repairs. If your car is in good condition, this means higher trade-in value. If your tires are worn, or belts, wipers and hoses have needed replacement, this indicates poor maintenance. For best trade-in value, also keep good maintenance records.

If your car has original paint, this is a positive selling feature, since the manufacture warranty only covers original paint for damage such as peeling.

In addition, if your car is clean, this is another plus. If the dealer must spend money detailing the car, this costs them money and ultimately reduces your trade-in value. If you make these repairs or maintenance before you take the car into the dealership, you significantly increase your trade-in value; this is worth it, since the money you’ll spend making these repairs will actually make you money on the trade-in in the long run.

Market conditions

If the overall market at the time of trade-in is in your favor, of course, you’ll make more on the trade-in. The reverse is also true. Even though this is something that you don’t have control over, understanding how trade-in works should at least make a lower price than you expected easier to swallow. Everything from car type (for example, SUVs were once in great demand and now are somewhat less so, since gas prices have gone up so much) to the amount of good quality used vehicles (some with warranty already included) on the market can affect what trade-in price you get. Therefore, you have to adjust your price to account for these factors.

Dealership

What dealership you trade your car in it can affect what you get, although to make sure this is true, you have to do your homework carefully. Oftentimes, for example, if you take your Subaru to a Subaru dealership to trade it in, you’ll get more than you would at a generic used car lot, since Subaru dealers will be looking for good Subaru cars to place on their lot. However, if the city you live in is quite large, dealerships often trade or sell cars between them, so prices you are offered between dealerships are likely be much more consistent with each other.