When a dealership’s finance department mentions purchasing an extended warranty, most people want to hide under the desk. After making one of the biggest purchases of your life, you may not be ready to face any extra money at the close of sale.
Or, you might just think that you are paying out for nothing or on the slim chance that something might go wrong with your vehicle. However, there are many reasons why you should consider an extended warranty.
Measurable Benefits that Yield a Return on Investment
If you are buying a new car, you most likely think, “What could possibly go wrong? Plus, I have a warranty that comes with it already.” If you are purchasing a used vehicle, you may think it is better to gamble that nothing will go “too” wrong. However, the law of averages almost always seems to lead to the fact that something stops working on a vehicle just days after the standard warranty runs out.
Although most vehicles come with a 3-year/36,000 mile bumper-to-bumper warranty, you will have no protection against mechanical breakdowns when that expires. That’s when you need to think about these reasons why an extended vehicle warranty will pay you back:
- The biggest benefit is saving on repair expenses when they do arise. Usually, the deductible is so small compared to what the repairs cost. And, some of the repairs in the long run will cost more than the warranty itself.
- Once the standard warranty runs out, the extended plan immediately kicks in so there is no lapse where a repair would not be covered.
- Having an extended warranty is a good selling point if an owner wants to re-sell the car down the line to someone else. Most plans can be transferred to the new vehicle owner.
- You can bring the car back to the dealership where you purchased it or to another certified dealer if you have moved since your original purchase. This provides you with peace of mind that the work is being completed by someone who knows your car, truck, or SUV from the inside out.
Remember that buying an extended vehicle warranty at the point of purchase is cheaper than buying it a few years later just when the standards warranty runs out. Here’s why:
- You’ll find that you will less likely bother to make the investment then and take the gambling approach.
- Waiting to pick a plan as the existing warranty wraps up, you may find yourself selecting some type of Internet warranty company that turns out to not be a reputable business. Instead, purchasing this warranty through a dealership will ensure that you will be working with a trusted company.
- Plus, if you buy the extended warranty when you purchase the car, the warranty can be added into what gets financed.
Types of Extended Warranties
The best type of extended warranties is one that is considered comprehensive in nature. Offering the greatest value for you, these plans often include some key benefits like rental car allowances, free towing, trip-interruption coverage, lost key/lockout service and monthly payment options.
Even within the comprehensive category of extended warranties, there are a number of plans to consider. In working with a dealership, it is important that the finance department or your sales person covers the plans and works with you to figure out the one that is right for your situation.
The Right Approach
As a consumer, you need to know the facts:
- Be sure to ask what is covered under the warranty and what is not.
- Read the booklet and all the fine print.
- Learn how the warranty process works so you can be prepared to cover the deductible or any other costs that are not included.
Do you have questions or are you unsure of the process? Please submit your questions below and we will be happy to provide you some answers. You can also contact us directly to learn more.
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