Buying a new car involves a lot of patience, diligence and most importantly money. Thus, people like their car to last as long as possible. Careful maintenance is the key. Having a car extended warranty has also become important these days since the cars have a complex technology and sophisticated electronics. Having an extended warranty can save money on unforeseen expenditure. However, it is quite expensive. Thus, one must weigh the pros and cons of buying an extended warranty as discussed below before buying it.
Pros
- Extended warranty can be customized
Car manufacturing companies offer car warranty that covers either three to ten years or 30,000 to 100,000 miles. Thus, it is either the time period or mileage for them. Extended warranty, on the other hand, can be customized as it comes with various services and products. For instance, if a car comes with shorter bumper to bumper warranty and a lengthy powertrain warranty, the third party warranty can be taken to cover the shorter coverage. Extended warranty also comes with 24-hour roadside assistance which is not available from the manufacturers for new vehicles. - Covers pricey technology and costly repairs
Modern vehicles are quite complex with their electrical wiring, expensive technology, and computerized equipment. Failure of such system can be expensive to isolate, diagnose, and repair. One of the main reasons for buying an extended warranty is due to the technological systems found in modern cars. When you decide to buy an extended warranty, ensure that it covers all the technical issues that may arise and need repairing. - Ease of purchase
It is quite easy to buy an extended warranty especially if you choose to buy it from the dealership. Moreover, the dealership takes care of the paperwork as well. You may choose to do it later on. Most dealers offer this warranty as a package with the car. It will cost a little extra, however, the dealership will do the needful regarding setting up the payment. You get both car financing and extended warranty when you buy a car which can surely be termed as a great deal. In case of any problem in the future, you can get the car repaired from the dealership you bought it from.
Cons
- Warranty usage
You may never have to repair the car if you are lucky. In a situation where your car did not go through any serious problem, the extended warranty need not be used. This simply means that you paid a lot of money for something that could never be used. You could have used this money for the down payment when you bought the car. The amount of car loan you have to pay would have been less. Moreover, there are people who sell theirs within a few years of usage. For those people, buying an extended warranty is never a wise decision. - Coverage of repairs
You may think that an extended warranty would cover everything that could happen to your car. But that is not the truth. Most warranties comprise of an exclusion list. There are parts and systems that are not covered under the warranty. Thus, in case of any malfunctions in regards to those will not be entertained. When you check the exclusion list, check all the repair shops listed under the warranty cover that would fix your car. This is only needed when you buy a warranty from a third-party and not the dealer. - Extended warranty is expensive
Buying an extended warranty needs you to pay a lot of money. It is a bet that you are placing hoping that your car would need repairing which would cost more than the amount you paid to buy the warranty. But if that never happens, then your entire money is lost. If you are still keen on buying an extended warranty, it is suggested that you negotiate the price. You could at least save some money in this way.
You may or may not choose to go for an extended warranty once you get the car loan approval. You can decide based on your careful management and previous record of car handling.
