Buying a used car can be a complicated process because of all the options available. One of those options is a certified pre-owned car. These are cars that are under 5 years old with low mileage. There are 2 kinds of certified pre-owned cars; factory backed and dealer backed.

The factory backed or manufacturers certified pre-owner is the most popular because the car maker warranties it at no additional cost to the buyer. One big benefit of this is that the buyer can get a fairly new car, particularly a luxury car for less than the cost of a new car. The buyer also gets piece of mind because of the warranty.

Factory backed certified pre-owned vehicles are put through a rigorous inspection and all necessary repairs have been done. Due to this and the warranty, certified pre-owned cars are sold at a higher price than non-certified vehicles. On average a luxury certified vehicle will cost between $2000 and $3500 more. A non-luxury vehicle will cost $300 to $1750 more. Each manufacturer’s program is slightly different, so doing some research is always a good idea.

A certified pre-owned dealer backed vehicle is very much different from a factory backed one. In this case, the dealer also conducts an in depth inspection of the car. This inspection may not be as extensive as the factory backed. Although the vehicle will have any remaining factory warranty, the dealer does require the buyer to purchase an extended warranty. The cost of a dealer backed certified pre-owned vehicle is usually less than a factory backed one.

In either case, a certified pre-owned vehicle is really designed for someone who is interested in owning a late model, low mileage car for less than the cost of a new one. It is also for someone who is not really knowledgeable about car repairs or who do not to bother with car repairs. In this instance, the extra cost involved in purchasing a certified pre-owned vehicle is worth it.

No matter what type of used car is purchased, the buyer still has to decide what to do with the older vehicle. Almost all buying guides indicate that using it as a trade in is not a benefit. There are also many negatives associated with selling the car to an individual. The biggest problem with that is the liability that is involved in the case where the new buyer does not title or register the car in their name. In this situation, the seller of the vehicle is liable for any tickets, accidents, etc. with respect to that vehicle.

A very good alternative to selling the vehicle privately is to donate car to charity. Most charities that have a car donation program are happy to accept a vehicle in virtually any condition. They will sell the donated car and use the proceeds to help further their charitable mission. In return, the donor is entitled to a tax deduction of the greater of $500 or the amount the charity sells the vehicle for. The charity also takes care of all the paperwork with respect to the title so the donor does not have to worry about any repercussions.