Paying extra to buy a certified pre-owned car is supposed to bring you peace of mind. But don't count on it. There has been a sharp increase in the number of cases involving certified used cars that have been previously wrecked or have other substantial problems, says the consumer attorney Daniel Blinn of the Connecticut-based Consumer Law Group.
"I’m going nuts with these certified pre-owned vehicles," said Blinn, who recently blogged about the problem. He says he currently has about a half dozen cases centering on certified used vehicles. One involves a certified 2010 Mazda that Blinn says was sold to an unsuspecting consumer after being wrecked and then poorly repaired.
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Consumers pay a premium for certified used cars because those vehicles typically come with a manufacturer's warranty and are marketed as having been thoroughly checked to ensure the vehicle meets high manufacturer standards. For example, Toyota boasts of a certified pre-owned checklist that includes 160 items. "We check 160 points," the Toyota website says. "All to prove one point: Only the best get to be Toyota Certified Used Vehicles."
But they may not be the best after all, says Blinn, who points to evidence that some dealers don't conduct the detailed inspections. He said his office asked an independent auto expert to assess a certified Toyota that turned out to have been previously wrecked. He said the expert found such issues as dirty filters and misaligned headlights. He said some used cars have been certified even though they have clear signs of having been in a collision and undergone bodywork, including mismatched paint, over spray, and unresolved structural problems. He said auto body experts have deemed some unsafe to drive.
That was the case with a Nissan Altima a U.S. service member had bought for his wife and child to use during his deployment to Afghanistan. He learned about the vehicle's structural problems when he returned and tried to trade it in, Blinn said. "I've had a handful of cases that really got me angry, and this one really got me angry," he said.
Often dealers automatically certify late-model used cars, which means consumers get stuck paying hundreds of dollars extra for manufacturer warranties even if they don't want them. Consumer Reports is not a big fan of these warranties, believing instead that consumers should bank that extra money and instead buy reliable used vehicles that have been thoroughly checked by a mechanic.
For more tips on buying a used car, check our used car buying guide.
What to do
- When buying a used car, don't assume that certification means the vehicle hasn't been wrecked, flooded, or suffered other serious damage, or that it's even been properly inspected.
- Inspect the front and back of the vehicle title. Verify that the mileage statement agrees with the vehicle's odometer and that the title isn't "branded" with "Salvage," "Junk," "Rebuilt," Flood," "Recovered theft," "Lemon law buyback," or similar terms that indicate the car or truck has a troubled past. Also verify that there is no unpaid loan. If the dealer won't let you see the title or doesn't have it, take a pass on that vehicle.
- Expect the dealer to provide a free used-car history report from Carfax or AutoCheck, and then call the reporting service to verify the report hasn't been altered. Also conduct a free VINCheck vehicle-history search at the National Insurance Crime Bureau website. But keep in mind that vehicle history reports can miss a lot. Over the years, we've found many examples of wrecked vehicles that had clean reports. That can happen, for example, if a vehicle is self-insured, which often is the case for rental cars, or if the damaged car or truck isn't covered by collision insurance and an accident report isn't filed with police.
- No matter how good that used car looks, have it checked out by a reliable mechanic, preferably one experienced in auto body work. Don't rely on your mechanic's offer to do a quick inspection free. A used vehicle must be checked thoroughly, a service for which you should expect to pay about $100. Ask the mechanic what the inspection will entail, and request a written report. If a dealer won't let you take the car to your mechanic, go elsewhere. It's a sign he's hiding something. Don't let a dealer persuade you to forgo the inspection because the vehicle is certified or covered by a manufacturer's warranty.
- If you must make a deposit before obtaining an inspection, make sure the paperwork says it's refundable. And always use a credit card. That way, if there are any shenanigans, you can ask your card issuer to initiate a chargeback. If you pay by cash or check or by using a debit card, getting your money back can be a hassle even if you can prove that the dealer engaged in wrongdoing.
- If you buy a used car—certified or not—and discover that it had previous accident damage or other serious problems that a dealer failed to disclose, contact a consumer attorney and your local or state consumer protection agency.
— Anthony Giorgianni
Copyright © 2005-2014 Consumers Union of U.S., Inc. No reproduction, in whole or in part, without written permission. Consumer Reports has no relationship with any advertisers on this site.