Do You Really Need An Extended Auto Warranty?
Buying a car is a big investment. As such, it’s near impossible to simply walk into your nearest auto dealership, pick a car, and leave with it. Car buyers know this, and this is why many spend an average of up to four months just deciding which make and model they want.
The problem is that it’s easy to focus on looks and forget the fact that cars eventually depreciate in value and need replacing.
Cars are very complicated pieces of machinery and can break down when you least expect. For this reason, you’ll need to consider the routine maintenance and repairs that your car will need from the time of purchase. This is where auto warranties come in.
Manufacturer-backed car warranties
New cars come with a variety of warranties which promise to make repairs and replacements over a certain period of time. The most notable is the manufacturer backed ‘bumper-to-bumper’ warranty that remains in effect for around 3 to 5 years or the first 30,000 to 100,000 miles (this varies depending on manufacturer). The bumper-to-bumper warranty covers all vehicle repairs except wear items like tires and routine maintenance like oil changes.
Another type of warranty is the powertrain warranty, which covers repair costs associated with the engine, transmission, and drivetrain and usually last longer than the bumper-to-bumper warranty.
Extended auto warranty
Manufacturer warranties only cover so much before you are liable to pay for repairs. This is why many drivers opt for extended auto warranties that are usually recommended by dealers or third party sellers and are meant to take effect after your manufacturer backed warranties expire.
An extended car warranty can be purchased when you buy your vehicle or shortly before or after the manufacturer warranty expires. This warranty can extend your manufacturer-backed car warranty by more than 20,000 miles and often includes other coverage like roadside assistance or a free rental car.
Reasons for and against an extended auto warranty
Extended auto warranties have received praise and condemnation from car owners in equal measure. There are those who say that they would buy it again, while others feel that it was of no help at all. Those who are happy reported having
- Peace of mind without worrying about emergency repairs.
- A reduced risk of expensive repairs.
- Extra security because they plan to use their vehicles for many years to come.
- Better resale value of their cars.
Those who are against extended auto warranty feel that:
- It didn’t amount to saving much money.
- It ended up being more expensive than paying for repairs.
- They were not able to maximize on the warranty.
Is an extended auto warranty worth it?
With extended car warranties, no situation is the same. In order to find out if you need an extended car warranty, think about:
- The reliability of your car brand.
- How long you intend to keep your car.
- Emergency preparedness in case of a surprise breakdown.
- Sources of car repair funding that you have.
If you come to the conclusion that you need an extended auto warranty, it is important that you look for a good dealership or third party seller and avoid being scammed. After that you need to read and understand your warranty, service your car regularly, and keep all your service records and receipts to avoid warranty issues.
This article was contributed by Costea Lestoc.