Extended Car Warranties Can Be Very Useful in Event of Major Failures

Is it worth the added cost to purchase an extended warranty on a used car? Making this decision can be a very complicated one since there are so many different options available to the consumer now and it seems that there are almost as many extended warranty plans out there as there are car models to choose from.

Essentially it all depends on the particular vehicle in question, it's maintenance history, the number of miles on the car, and the estimated cost of the coverage, all versus the potential real cost of repairs over the length of the extended warranty period. It is very likely that you will never need the coverage and yet you may have paid up to many thousands of dollars to own that coverage.

Remember one of the things your fee will cover is the commission that the salesperson will make on the extended warranty, and that money does nothing to help you when a warranty claim is denied for one reason or another. You can tell there is a good profit involved when you are exposed to hard sell tactics in order to close the extended warranty deal. When I went with my friend to help her negotiate a certified used RAV4, the salesperson and the sales manager were giving her some pressure to sign the agreement for the most costly extended warranty, when I asked them to show us the detailed breakdown on what each level of coverage offered they were upset and stomped away to print off these documents. It was evident that they felt that part of the deal was already sealed and that we were messing with their profit at that point. She did choose the more costly version, but we negotiated that cost down by quite a bit by mentioning that there was another car she loved at a dealership down the street. Surprising what a little bit of walking can do towards saving money on a deal.

Extended warranties can either be a real lifesaver when something major goes wrong with your car, or they can be a total waste of your hard earned money. There are many types of extended warranty available and some are more cost effective than others. Most will be added on top of any existing factory warranties. The length and type of extended warranty you may choose to purchase for your car can vary widely in terms of specific items that may be covered all the way up to the months and mileage limits that will be imposed.

Most factory warranties are transferable, and will go to the new owner when the title transfers into their name. an extended warranty can be tailored to suit your budget and your expectations in terms of the exact parts which will be covered in the event something goes wrong with your car.

One myth about extended warranties is that you have to take the car back to the dealer where you bought the warranty coverage from, but this is simply not the case. You can get the car fixed almost anywhere, but you may be out the cash until you can get reimbursed by the warranty company, and that may take a while. You will need to document everything very clearly in your logbook, and at the same time if you ever do any work on our own such as changing the oil and filter keep a log plus the receipts for the parts you used when changing the oil. You will never regret having too much information when it comes to discussing any warranty related issues with your dealer.

As always it is wise to read over the fine print at your leisure, contrary to popular opinion, you do not have to decide right this minute which version of extended coverage you need to buy, and do not succumb to the pressure tactics as it is your money and your decision. The simple truth is that since extended warranty coverage can be a lucrative side business for your local dealership it is in their best interest to have you buy this coverage from them, but you do not have to purchase this from them and can go out and shop around before making a final decision. In fact these extended warranties can be purchased on line now.

A friend recently showed me the extended warranty being offered with her "certified previously owned" Toyota RAV4 and it was quite enlightening when I went line by line comparing what was covered with the most costly version versus the cheapest option.

It appears that the sales person and the dealership both stand to make some significant extra cash when selling you these insurance policies called extended warranty programs. The trick is to decide if you need to add the extended warranty cost onto your loan or pay for it outright, this is because if you are financing the car and tack on the $1500 - $2000 for the extended warranty with interest it can cost you ten or fifteen percent more in interest on a typical car loan.

So be a smart consumer and study your options before going to the dealership to make a deal on your new or used car, and you will likely save money in the long run. In my experience the certified used cars seem to be the most reliable ones to choose from. When combined with an affordable extended warranty you should be able to drive that car with confidence for many years.

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