Is It Worth It to Buy an Extended Car Warranty?
So you’re just about finished buying your new or used car when the salesman hits you with the question “would you like to purchase our extended new car warranty?” Hold the phone – you hadn’t even given that any thought. Is it worth the money to buy the extended warranty? Will it cover the things that you need? Will you ever use it? Actually, what even is an extended car warranty?
Before you start to panic, take a breath, and check out this video (or continue reading below if you prefer the text version.)
What is an extended warranty for a car?
When you make any large purchase, such as a TV or a cell phone, the salesperson is going to try and sell you an extended warranty. The same is true when you buy a new or used car. These extended warranties are not the warranties that automatically come with your new car, rather they are warranties that exceed your new car warranty and can be purchased separately. These extended warranties are meant to cover the cost of certain repairs and issues after the car’s factory warranty expires.
Is it worth it to buy the extended warranty on a car?
The truth is there are some extended warranties out there that are good deals, and there are some that are completely not worth it. There are so many variables that go into these extended warranties, it’s hard to make a blanket statement about whether they are good or bad. The best thing to do is to read the fine print and familiarize yourself with the warranty before you purchase it – don’t just take the salespersons word for it!
Here at West Escondido & West El Cajon Automotive & Transmission, we have people come in a lot who say that their extended warranty was supposed to cover them “from bumper to bumper.” This is very generic language and doesn’t clearly state what the warranty is going to cover. As it turns out, warranties such as this end up having a lot of disclaimers in the fine print that leaves out a lot of expensive auto repair services.
What auto repair or maintenance services aren’t covered in my extended car warranty?
Again, each extended warranty is different, which is why it’s important to understand what you’re really getting when you purchase one. But typically speaking, these warranties often exclude external things, such as: sensors, maintenance items, chassis parts (framework, ball joints, etc.)
Another thing they do with some of these aftermarket extended warranties is replace failed car parts with “like-kind quality.” What this means is if you transmission fails, rather than rebuilding it or replacing it with a new one, the warranty only covers the cost to replace it with another used transmission – potentially not worth the amount of money that you paid for the warranty in the first place!
Tips for purchasing an aftermarket extended warranty:
- Always read the disclaimers and fine print.
- Weigh the cost of the warranty vs. the cost of the repairs.
- New car extended warranties tend to be better than used car extended warranties.
- If you are purchasing a new car, determine if you plan on keeping the car past the original manufacturer’s warranty.
- If you’re ever not completely sure about buying an extended warranty, bring it to your trusted auto repair shop and have your mechanic review the warranty for you.