When buying a car, you always have to worry about reliability, repair costs, and your car’s condition. But do you need an extended warranty?
Typically, an extended warranty kicks in after the manufacturer’s warranty ends. The goal is to stabilize repair costs that would otherwise surge at random points in time. For many, this is a question you will face when you visit the finance manager’s office after buying a car from a dealership. Instead of deciding whether you need this service on the spot, you should take some time to think about it. Here, we give you five reasons to consider getting an extended warranty.
1. Prepare Yourself for Recurring Repair Costs
Even reliable vehicles need repairs and maintenance. You already know ahead of time that you’ll need to pay for these, and an extended warranty can manage repair costs for you. Also, if you end up facing a major repair like needing to replace the car’s transmission, an extended warranty can cover the costs that would otherwise leave you in financial trouble.
If you are planning on keeping your car for a long time, then an extended warranty might be the best choice for you. U.S. News and World Report is one resource for reliability ratings to help you see if repairs are a common issue for your vehicle.
2. Technology is Making Extended Warranties Cheaper
Dealerships often increase their profits by selling extended warranties. Warranties are marked up, and the extra costs go to you… the customer.
At TRED, the story is different… we don’t have physical dealerships. This lets us keep overhead costs low and lowering our customers’ costs in the process. Instead of selling cars ourselves, we instead connect buyers and sellers together on a trustworthy platform with built-in safeguards. Because of this, we can charge much less for extended warranties.
3. Have Peace of Mind
One of the most stressful parts about buying a used vehicle can be the anticipation of future repair costs and possible breakdowns. During the buying process, you may find yourself wondering, “is this car going to be reliable? Will it break down on me?”
At TRED, we provide 150-point inspections on all cars listed to give buyers quality assurance. So you might ask: if you know that a car is perfectly healthy, why should you get an extended warranty?
If you drive a BMW, repair costs can get rather expensive because they are high-performance vehicles that require regular maintenance. If you are driving an older vehicle and plan on keeping it awhile, you will almost certainly pay thousands in repairs over your ownership of the vehicle to keep it going for 200,000 or more. Instead of covering this yourself, have some peace of mind knowing that the bills are covered.
4. Most Warranties are Transferable or Cancelable
Now that you can transfer or cancel extended warranties, they offer even more utility beyond just covering your costs:
- Car buyers want reliable sellers. The private market for owners selling directly to buyers is growing. People don’t want to deal with a salesman. Nothing tells a buyer more that a deal is safe than an extended warranty. It shows them that you are committed to the car’s condition.
- You can always sell the car with ease. Even if the buyer does not want the warranty, you can cancel it for a partial refund. You will not be stuck in a contract for a car you do not own or pay extra unforeseen costs for cancellation.
- If the costs are too high, just cancel. When you are done with the warranty, just cancel it. That means, even after negotiating prices and getting the best coverage possible, you still have options if it ends up breaking the bank.
5. Extra Protection for the Right Car
Let’s be honest, extended warranties are not right for every vehicle. But if you are buying a German car with extra mileage like an Audi, BMW, or Volkswagen, data suggests that most owners can expect to pay thousands in repair costs. Repairs for high-performance cars can get very expensive.
So you need to figure out whether you car may need extra protection, or if you can take the risk and go without protection.
As we said, extended warranties are not right for every vehicle owner. But now that there are more lower-cost options, it’s worth taking a second look and considering the financial safety an extended warranty can provide. With a warranty, you will know how much you’ll have to pay to maintain your vehicle, and you don’t have to worry about surging costs. It can give you the freedom to drive your car without worry. So do your research and find out whether you need an extended warranty for your car.
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