How to Negotiate a Price for a Certified Preowned Car?
Price negotiation is one of the main points to consider when buying a used car. Any type of car purchase may require some light bargaining, but used cars should not be bought at the asking value. A certified pre-owned vehicle costs much higher than cars that are typically found in local dealerships. Used car price varies with each different vehicle. So knowing how to negotiate the price for certified pre-owned cars is essential.
When buying a new car, we do not worry much about bargaining as most cars are sold at a fixed rate that is controlled by the manufacturer with a full-proof factory invoice record. But for used car shopping, it becomes a known devil that if you do not carry out a good negotiation process, then you are sure to lose a lot of money on a much cheaper car. And this becomes a huge problem when your target is to buy certified pre-owned cars.
What Is a Certified Pre-Owned Car?
Now, the first thing you need to know is to understand what certified pre-owned cars actually mean. These cars are also called CPO cars in short. Certified pre-owned cars are cars that are resold by authorized dealers who can offer a warranty to the customers when they buy these cars. As expected, the warranty costs some extra money but definitely has some perks added to it.
The actual certified pre-owned cars are mainly sold by franchised dealers as they have more influence and budget to invest in getting vehicles certified. A CPO vehicle is of good quality, is in great condition, and can withstand the strain of possible usage in the upcoming years. For this reason, only the vehicles that can be repaired in a way that the dealers can ensure the smooth run of the cars after they are sold are qualified to become CPOs.
Normally, the cars that get selected to get certified need to be cars that are relatively new. They need to have good original parts and must have almost zero records of major accidents. Any type of vehicle can be CPO as long as they have low mileage and does not need severe repairs. Thus, almost all the cars we see being sold as CPO cars are mostly lease returns or cars that have been taken great care of by the last owner.
Is It Smart to Buy a CPO?
Before a car gets certified as a CPO, it goes through major and intense inspection procedures that ensure the car’s quality. So these cars can be a great way of buying cars for buyers who are always a bit skeptical about buying used cars. According to sites like Kelley Blue Book, a normal good quality CPO car can be bought at $850, which can get up to $3000 for a newer luxury car.
Many people want to buy used cars but are reluctant for fear that they will get scammed and the car will turn out to be faulty. But CPO cars can help them become more comfortable with buying second-hand cars.
Researchers say that the main reason a new car loses worth when reselling is the fact that the majority of the depreciation is calculated in the first year of the car’s ownership. This reduces the value of the car. So, a smart buyer might prefer to buy a certified car that was previously owned by someone for just 2 or 3 years. That car is almost good as new. And the vehicle history report will let you check the lifetime of the vehicle in detail.
Should You Negotiate the Car Price of CPO Cars?
CPO vehicles are just used cars but better. These cars are not the scrap material that someone picked up and repaired. These cars are put up for resale in mint condition. A CPO vehicle can perform as well as a new car without any common issues. So the sale of CPO cars has become more and more popular for buyers who prefer to avoid risky transactions with an ordinary years-old vehicle.
A car dealer always strives to get the highest profit from their used car sales. But it is up to the buyer to find the best price that works for both parties. With CPO cars, the typical increased value depends on the demand in the market, not the dealer cost. Also, the added features, benefits, protection, and warranty increases the price by a lot. So negotiation is a must if you want to shake off unnecessary added fees and features that you do not need.
How to Purchase Certified Pre-Owned Vehicles?
To purchase a certified preowned car, car buyers need to first know where to find one. Even though the demand and popularity of CPO cars are on the rise, it is not easy to find one in every local dealership. So you need to follow some precise steps to check whether it actually is something you should buy, and if yes, then how to get to it.
Fix a Budget
Paying cash money for a car is getting more and more obsolete. Because of the fact that certified pre-owned cars tend to be more expensive than ordinary used cars, it is important to fix a specific budget range first. There are different CPO vehicles with different features in a vast price range. Your budget will let you focus on a specific array of vehicles without wasting time.
Do Proper Research
It is very important to do proper research before buying a used car. This is more true for certified preowned cars. You need to contact different dealerships to check how much each of them is asking for cars that are similar in quality and features. This will help you have the upper hand in the negotiation process.
Arrange the Finances
After you know what your budget for a car is, you need to ensure the financing part of the matter. It is wise to have the financing ready before going into the negotiation process. If you do not have a way of paying for the car, there is no point in going into an elaborate negotiation process just to back off last minute.
Look Out for Deals
Do you know that often there are deals and discounts offered by different dealers? These deals are active in certain seasons for certain models. These are the main way of buying cars for a much cheaper cost. Also, with the help of discounts, it is much easier to get a good CPO vehicle at a reduced cost.
How to Negotiate the Price for a Certified Pre-owned Car?
Now, let’s talk about the negotiation process. This is the point where you will see whether you win or the salesperson does in the transaction. Negotiation is a skill that requires good communication expertise and understanding someone else’s point of view and thought process. But not all of us are good at reading people when the salespeople have always trained professionals. So a strategy is a must.
- First, you must approach the negotiation with the fact in mind that the dealers are the experts in this area. You will not win with your wits alone.
- When trying to lower the price of the car you want to buy, the trick is to negotiate the benefits they are providing, not the actual price of the car. Dealers will be offering extra opportunities and protection clauses in the contract that are adding to the cost without you knowing about them.
- Cut off any unnecessary parts of the deal. Extra warranty years, wheel and tires insurance, etchings all these can be avoided for a cheaper grand total.
- Get your own financing. If you buy the car in installments, the price will seem more because of the added interest.
- Be ready to walk away without buying the car. That is your biggest advantage. You must not be desperate for the car. You need to be prepared to redo this whole thing again in another dealership for another car.
There are a lot of dealers who are investing in certifying their good quality used car collections to make a bigger profit. This added cost of getting the vehicles inspected and certified needs to be received back through the sale of the car. So you need to accept the fact that no amount of negotiation will make the dealer sell the car at a loss. It is up to us to show respect to them for their effort in restoring the vehicles.
Be sure to follow the proper steps of negotiation with good manners and consideration for the dealer. Negotiation is important to buy a car at the best possible price that works for both parties. No one should be disappointed through the process. The situation needs to be friendly and accepting. It is a common part of the used car buying process that is accepted worldwide. So let’s all carry this out with all respect for each party.