When it comes to buying a car, one of the most common questions that arises is whether or not to purchase an extended warranty. While extended warranties can provide peace of mind, they are not always the best option for consumers. In fact, about one in five people who use an extended warranty are not satisfied with the repair, and there is a risk that the warranty provider may go bankrupt. Extended warranties are not considered guarantees under federal regulations and lack the legal protection of true warranties.
They are technically vehicle service contracts to repair a vehicle for a certain period of time. Before deciding whether or not to purchase an extended warranty, it is important to consider the advantages and disadvantages. Rather than buying an extended warranty, it may be wiser to invest in a car with better expected reliability. Doing your research and consulting reliable sources such as consumer reports can help you make an informed decision. Additionally, if you can shop around in your local area, repairing the car may cost less than the price of the extended warranty. Retailers may try to sell you an extended warranty by including a built-in “lemon law” provision.
This means that they know which parts of that model tend to break down and how quickly. Powertrain warranties cover the parts that set the vehicle in motion, including the engine, transmission, driveshaft, axles and differential. It is important to be aware that dealers may try to get you to buy an extended warranty before the factory warranty ends. This means that you may end up paying for something you don't need. If you decide to buy an extended warranty, be sure to do your research and work with a reputable company.
You could also save money by dividing the cost of an extended warranty by 12 and saving that amount each month. At the end of the day, adding an extended warranty to your car (especially if you owe money for it) just isn't worth it. It is important to consider all of your options before making a decision. Doing your research and shopping around can help you make an informed decision about whether or not an extended warranty is right for you.
