Extended Warranties for Autos?

[Yamaman]

Have any of you purchased extended warranties on used cars, and if so, what has been your experience. I'd like to determine if any of them are worthwhile, and if so, which companies sell the best ones. I know NOT to buy whatever the dealership is selling, as they are very overpriced. I recently bought a 2005 Chevy Trailblazer EXT 4wd with 58k and plan to keep it for 4-5 years. Any thoughts?

 

Thanks.

[SilvrT]

Years and years ago .... maybe around 1980 I bought a 1977 Chev van .... no factory warranty left so I bought the "third party" used vehicle warranty. Two weeks after I got it, the rear end crapped and it had to be replaced. The waranty covered it no problem and I think I had a $50 deductible. Dealer looked after all the paperwork.

[Flyinfool]

A coworker has an extended waranty on his Chevy Tahoe. He has an intermittent no start caused by an intermittent fuel pump on its way out. The warranty will not cover it because "it still works sometimes". He had to cough up the $500 out of his own pocket.

 

You are better off taking the money that you would have spent for the warranty and buy a CD at the bank. Even at current interest rates.

Buying the warranty is betting that you will have at least 2, major, covered, problems during the warranty period.

 

Yes there are a few people that are lucky (or is it unlucky) that the warranty has paid off for them, but that is a very small number. You have to remember that they do not make money selling you a warranty for what the think you might need in repairs. They take the average cost of covered repairs and at least double it to get your rate.

I keep saying "covered repairs" because they do not cover a lot of things.

[elmicko]

You really need to ask yourself a few questions before you decide to buy a warranty. How long do you usually keep a vehicle? If you trade every 3 - 5 years a warranty is a waste of money. Do you always keep some money in reserve in case an unexpected expense comes up? If having to shell out a few hundred dollars for an unexpected repair won't keep you from eating for a while, you don't need to buy the warranty.

 

If you do decide that a warranty is for you, generally the one that is backed by the manufacturer of the vehicle is the safest bet. There are some very good after-market warranty companies that give great service, but there are also a many many more that are almost impossible to get them to pay a claim. Keep in mind too that the guy at the dealership that's running your paperwork for the vehicle purchase gets paid on the sale of the warranty too. That means that you have a lot of negotiation room on the warranty price. Sometimes you can get them for close to half the cost it's originally offered at.

[MiCarl]

A coworker has an extended waranty on his Chevy Tahoe. He has an intermittent no start caused by an intermittent fuel pump on its way out. The warranty will not cover it because "it still works sometimes". He had to cough up the $500 out of his own pocket.

 

You are better off taking the money that you would have spent for the warranty and buy a CD at the bank. Even at current interest rates.

Buying the warranty is betting that you will have at least 2, major, covered, problems during the warranty period.

 

Yes there are a few people that are lucky (or is it unlucky) that the warranty has paid off for them, but that is a very small number. You have to remember that they do not make money selling you a warranty for what the think you might need in repairs. They take the average cost of covered repairs and at least double it to get your rate.

I keep saying "covered repairs" because they do not cover a lot of things.

 

Agreed.

 

It's like any insurance, you pay a premium to spread the risk around. On average they're losers, but if you're the guy with a big expense you make out.

 

Personally, I never insure anything where I can manage the risk from my own pocket.

[Trader]

My son got ripped off because he didn't keep full records of oil changes etc...plus he did some work himself.

 

Can't remember the company...but that was enought to void his warantee. $1500 for nothing...thank you very much!

[autopilot]

I had an aftermarket warranty on my 2000 GMC P/U (bought in '05 w/ 77k miles on the odo. from a typical used car lot) I used it (the warranty, but I ended up paying as much for the repairs as the warranty paid for [it paid $1000; I paid $1000..........kind of a good news/bad news deal] It was awkward to use and the dealer service guys just about rolled their eyes whenever I showed up. Plus it took an inordinate amount of time, because you had to get the warranty co. to buy off on the repair ahead of time before they'd fork over the dough to the dealer. (like dental work....which is a good analogy becuse it literally was like pulling teeth).

 

In talking to the dealer and the service reps at length about the whole warranty issue, I determined that even though it's more expensive up front to buy it from the dealer, it actually covers more (depending on which level of coverage you get, obviously), is easier to use and I believe at the end of the day, overall would be less expensive, especially if your time is worth anything to you.

 

At the time I was cutting skinny on ready cash because I had just within the week, bought my wife a new Escape; so of necessity I opted for the cheaper aftermarket warranty. In retrospect, I should have got off my wallet a little more and gone with the dealer's warranty.

 

That's my 3cents

[Flyinfool]

I had an aftermarket warranty on my 2000 GMC P/U (bought in '05 w/ 77k miles on the odo. from a typical used car lot) I used it (the warranty, but I ended up paying as much for the repairs as the warranty paid for [it paid $1000; I paid $1000..........kind of a good news/bad news deal] It was awkward to use and the dealer service guys just about rolled their eyes whenever I showed up. Plus it took an inordinate amount of time, because you had to get the warranty co. to buy off on the repair ahead of time before they'd fork over the dough to the dealer. (like dental work....which is a good analogy becuse it literally was like pulling teeth).

 

In talking to the dealer and the service reps at length about the whole warranty issue, I determined that even though it's more expensive up front to buy it from the dealer, it actually covers more (depending on which level of coverage you get, obviously), is easier to use and I believe at the end of the day, overall would be less expensive, especially if your time is worth anything to you.

 

At the time I was cutting skinny on ready cash because I had just within the week, bought my wife a new Escape; so of necessity I opted for the cheaper aftermarket warranty. In retrospect, I should have got off my wallet a little more and gone with the dealer's warranty.

 

That's my 3cents

 

But are you really ahead?

If you paid less than $1000 for the warranty then you are ahead by the difference, if you paid more than $1000 for the warranty then the warranty is still in the black on your deal.

[eusa1]

after 25 years of writing service in auto dealerships, here is my answer.

 

buy your extended coverage from the same company that manufactures the car your purchasing-

gm car=gm plan

ford car =ford plan

toyota car= toyota plan

you get the idea, the reason being. that most aftermarket warranty plan companies will fail and fold up and never to be found again after about three years, and will take more effort than most consumers will put forth to find them.

most of these aftermarket companies will have a catch in the plan that says you have to take it back to "the selling dealer" for covered repairs, and if your off to see mickey or grandma and 600 miles from your selling dealer......well then your screwed... they only cover up to a 50 dollar towing service---woopty dooo!!

 

most major dealers extended coverage plans like gm, will tow you to the nearest gm dealer, provide you with a rental, and even pay for motels in the event of an overnight repair that is more than 100 miles from your home.

 

my favorite customer statement was "by gawd i had one of them plans once!! paid alotta money for it!! never used the damn thang!"

 

my favorite reply was " do you have life insurance? do you hope you use it ?"

or at the end of each year, do you complain to your insurance man if you didn't crash your car??

look very close to any plans that you have, the favorite trick is to put small #s or * signs after a covered item, and if you look hard you will find they apply to a way to screw the owner.

there is no plan, for any automobile that has true "bumper to bumper coverage" none!

that is a statement that should be outlawed! and none of them cover any bumpers and the dealers make more profit from the in house warranty, so thats the one they will advise you to purchase. ask your service writer or manager.

 

i hope this helps you with your question. mike

[Yamaman]

Thanks everyone for the opinions and advice. There's some very helpful info there, but what I was really looking for is the names of the warranty companies that you have used, good, bad or ugly. I realize that the warranty is a type of insurance and that it's hopefully something that I will never use. Sooo... anybody have any specific companies to recommend (web sites are good) or to shy away from? Don't know if I can still buy a plan from the manufacturer. Car is a Chevy but I purchased it from a Ford dealer, so I don't know if I want to go back to him either. I bought the vehicle about 60 days ago.

 

Thanks.

[midnightventure]

From what I have read in the paper we have some based in St. Louis that are crooked. I know years ago my sister had one and had a repair done. It was one of those 50/50 deals and her part was as much as it should have cost to start with. The work was done where she bought the car and by the people that sold her the warranty.

[eusa1]

go to your nearest gm dealership and ask for the "F & I" office and they can sell you a plan. I does not matter where you purchased the car. the major gaurd plan is the best bang for the buck, and you can get a plan with zero deductible if you wish.

mike