In general, you should weigh the cost of a warranty against how much a major repair would financially devastate you. Also, check the car’s reliability ratings before deciding whether or not it is worth an extended warranty.
Some warranties have service requirements like only using approved repair shops. Also, some have yearly mileage limits.
Peace of Mind
Purchasing an extended warranty on a used vehicle is a great way to protect yourself from high repair bills. It is important to do the math and make sure you can afford a monthly payment that fits your budget. It is also important to understand the coverage options and deductibles of the company that you are considering. They should be transparent with their pricing and not hide fees.
Another factor to consider is how the plan will reimburse you for repairs. Some companies may require you to pay upfront and then get reimbursed, which can be a hassle. You should also check the Better Business Bureau rating of the company to ensure they are reliable and trustworthy.
Lastly, be aware that most warranties will only cover the cost of parts and labor. They will not cover pre-existing conditions or maintenance items such as oil changes and tire rotations. You should also consider whether the warranty is transferable if you decide to sell the vehicle.
Reliability
Whether you buy new or pre-owned, the car manufacturer’s warranty will eventually expire. It might be worth paying a premium to get an extended warranty from a reliable seller that covers the most common repairs. Check to see who backs the warranty, and how deductibles work.
You should also consider your risk tolerance, financial situation and vehicle reliability before buying an extended warranty. Beware of aggressive telemarketers offering extended warranties. These robocalls often link to companies with questionable financial standing and poor customer service.
If you have tens of thousands in savings or a good ability to borrow money, an extended warranty may be worthwhile for you. Just be sure to do the math before you sign a contract, and don’t let salespeople pressure you into an extended warranty that might not be right for your car. Most dealers offer payment options, and some allow you to roll the cost of the MBI or VSC into your auto loan.
Cost
Car warranties aren’t cheap. It’s easy to feel overwhelmed by the many options available when you’re shopping for a warranty online or at the dealership. You’re likely to be offered a warranty by the dealer, and you may even see ads for different warranties on your phone or television.
A warranty can help protect you from large repair bills, especially if your vehicle has high mileage. However, it’s important to understand the cost of a car warranty before you buy one.
The best way to find out what a warranty costs is to talk with an expert. You’ll also want to learn more about who backs the warranty. If it’s backed by a company with a shaky financial foundation or bad customer service, it won’t be worth much. Also, check that the warranty is transferable if you decide to sell or trade in your vehicle. A good warranty company, like CARCHEX, will make that clear.
Deductibles
Typically, an extended warranty will come with a deductible, which the customer would be responsible for in the event of a covered repair. These can vary from a few hundred dollars to thousands of dollars depending on the policy.
You should carefully review the deductibles and other fine print of any warranties you are considering before making a purchase. It is also a good idea to keep detailed records of all repairs and maintenance for your vehicle so you can prove to the warranty company that you are doing everything necessary to maintain your car’s safety and value.
Ultimately, the decision whether or not to buy an extended warranty for a used vehicle will be based on your budget and lifestyle. Drivers who plan to own their vehicles for a long time may find it worth the extra cost to avoid potential financial catastrophe. Talk through your options with the dealership or an independent warranty provider to make sure you are fully informed.should i buy extended warranty on used car
