When you're in the process of buying a car, purchasing an extended warranty may seem like a good idea. You're making a huge financial commitment and you want the peace of mind that comes with knowing that your investment will be protected for as long as possible. But the truth is, this particular "peace of mind" may be too expensive.
Will You Really Need the Coverage?
When considering 'is an extended warranty worth it', it all comes down to this: Will spending money on the extra protection actually save you money in the end? The answer is: Probably not. For example, in a survey conducted by Consumer Reports, most car buyers who opted for extended warranties reported losing money in the final analysis. Even if some necessary repairs were paid for by their plans, the costs of these repairs didn't add up to warranty prices.
And not all warranties are created equally. Some plans only cover certain parts of the car and even "bumper to bumper" coverage will probably not include every type of repair. Understanding what these used car warranties cover can go a long way between being taken and taking precaution.
If You Decide an Extended Warranty Makes Sense
It may be the case that having the benefit of extra coverage is worth every penny to you. Even if you do never need it, at least it's there, right? Make sure that, in purchasing an extended warranty on your vehicle, you consider a few things first...
Don't assume that you need to purchase the extended warranty at the dealership. You may actually find a better deal elsewhere. And while some buyers like the convenience of rolling the price of the warranty into the total amount that's being financed, doing this means that you'll end up paying interest on the warranty as well as the car.
Know that you can bargain for a better price. Just like with the vehicle that you're buying, the asking price doesn't necessarily have to be the final cost of the product. You'll never know if a better deal is possible unless you ask, and the worst that you'll ever be told is "no."
If you go in, go all the way. Bumper to bumper coverage is usually only a little more expensive than partial coverage, so if you're going to pay for the extended warranty anyway, you should probably go ahead and get full protection. If you have trouble saving and have bad credit then an extended warranty with your bad credit loan might not be a bad idea.
Read the fine print. Before you sign anything, make sure that you understand the warranty contract fully. You should be aware of exactly what is covered and what isn't and if there are any restrictions concerning which repair shops may be used.
If you're more concerned about finding a car that you can afford and figuring out how you're going to pay for that car, Auto Credit Express can help. Even if your credit is less than perfect, we can work with you to get the auto loan you need. Fill out our fast and secure online application to get started today.