Warranty

Deciding on a warranty for your new or used car purchase can often be as important as which type of vehicle you end up driving off the lot. With auto repair costs skyrocketing, especially among certain import brands, and the median cost of a car reaching the tens of thousands; protection of a car warranty has never been more important than it is today.

Still not all car warranties are created equal. It?s crucial when shopping for a car that you arm yourself with as much warranty information as possible to protect yourself both during the transaction and years down the line.

• So What Does a Warranty Do?

  Quite simply an auto warranty protects you from any major automotive problem that may come up in the future with a vehicle. There is a manufacturer warranty, which covers new cars and usually for a duration of 30k miles, and there is an optional extended warranty you can purchase for both used and new cars that can last from a couple years up to a decade.

  There are generally two kinds of extended warranties, bumper to bumper and power train, with a myriad of options within each. Power train warranties cover the stuff that makes a car run, such as engine and transmission. Bumper to bumper warranties cover everything on the car except items that fall into disrepair due to wear and tear, such as tires and brakes.

• What kind of warranty should you get?

  Well with so many different warranty variations available the general rule is to get as much warranty as you can afford. There are a ton of choices regarding length, mileage, rust protection, roadside assistance, and deductible amount but usually money spent on a warranty is saving you money down the line. There are even great services, such as a buyback clause where you can get money at the end of a warranty if you didn?t require it at all, and the ability to transfer your extended warranty to another vehicle, that can make your warranty decision easier.

  The most important thing to do is to research the car you intend to buy and think honestly about how you?re going to use it. Are you going to use it as a commuter vehicle? Then a high mileage warranty is the way to go. Sites like Edmunds.com, cars.com, consumer reports, fighting chance and autos.com can give you information not only to help you decide what kind of car to get, but also some insight into any future problems that might come up during the course of your extended warranty.

• Should you buy your warranty from the dealer?

  Generally buying an extended warranty from a dealership is more expensive than getting it from a direct warranty company. This is because dealerships will add an ADM (Additional Dealer Markup) cost to the warranty to provide them more flexibility with the price of a car. But often this is because the customer didn?t have any competing extended warranty offers with which to counter the dealership price.

  In this way shopping for an extended warranty is just like shopping for the car itself. Companies like Warranty direct, 1 Source Auto Warranty, Certified Car Care, and Warranty By Net can offer you very competitive warranty rates that you can use in leverage with the dealership or with the companies themselves. Remember that you can buy an extended warranty at any time?sometimes even after the manufacturer warranty has run out.

  The important thing is to do your homework and ask lots of questions. How will reimbursements take place? Do you have to pay for the repairs up front and then reimbursed later on? Is the deductible per visit or per repair? One of the big advantages of getting a dealer extended warranty is that you can usually get repairs done from an authorized dealer anywhere in the country. Again the key to getting a good extended warranty is to read through all relevant paperwork and make sure that every future contingency is taken care of.

• Paying for your warranty

  One of the easiest ways to pay for your extended warranty is to roll it over into your car loan. Many people discourage this idea, but as long as the terms of your loan are good, putting an additional $1000 or so on the loan should not make a huge difference.

  Just like shopping for the car and the warranty it?s important to shop for the best car loan financing that you can. One of the best ways to do this is to go to sites like lending tree, e-loan, and capitol one auto finance and get financing quotes with which you can use for leverage at the dealership. If they can?t beat it?then fine you?ve already got your financing in place. But if they can then you?ll be able to acquire an extended warranty that will provide you not only protection, but also peace of mind.