Old way was to consider a vehicle by its warranty, like 10 years and 100,000. Nowadays consider how long you may have the vehicle. Most manufactures are re-designing new vehicles faster. Most every 2 to 3 years. So look into an extended warranty if the vehicle you love does not have the warranty your comfortable with.
Extended Warranties Explained for New Cars, Used Cars, and Leased Cars:
Whether you are willing to buy a new or used car, you have to decide whether you want an extended warranty or not. If you are new to this term, then an extended warranty is an insurance policy that is designed to safeguard you against expensive repairs. Contrary to the name, these are not warranties in true sense; these are more of an insurance policy that covers repairs and/ or maintenance for a specific time period. The best thing is that extended warranties are available for both new and used cars.
Warranties can legally be offered by manufacturers only, so any coverage that you buy from a third party must be referred to as a Vehicle Service Contract. You can either buy an extended warranty at the time of purchase of the new vehicle, or you can wait for some time, before you buy one. Remember, an extended warranty is a must have since all vehicles are subject to depreciation and at some point of time you will have to bear expensive repairs. So it is always good to be prepared!
Do You Really Need an Extended Warranty?
Today many people believe that they don’t require an extended warranty since car manufacturing is becoming more reliable and secure. They believe that today’s cars are more robust and there are less chances of breakdown or facing expensive repairs. But in reality it is only a myth.
No doubt today’s cars are robust and safer, but that is because they use high-end electronics, parts and technologies. This means the repairs would be expensive than cars manufactured years ago. However, whether you need an extended warranty completely depends on your situation.
When Should You Consider an Extended Warranty?
1. If you have purchased an used car that has already passed the manufacturer’s warranty period.
2. If you buy a new car and plan to keep it for a long period of time (beyond the manufacturer’s warranty period).
3. If you want to improve the resale value of your car.
When You Don’t Need to Consider an Extended Warranty?
1. You are planning to sell off or trade-in your car before the manufacturer’s warranty gets over.
2. If you lease a car and the following cases are true for you:
a) If you leased a car that is covered by the manufacturer’s warranty.
b) You lease a car for a period lesser than the manufacturer’s warranty period.
c) You ensure that the mileage limit of the factory will not exceed within the lease period.
Types of Warranties:
If you are considering buying an extended warranty, you will have two choices:
1. Warranties backed by the car’s manufacturers and
2. Warranties sold by independent companies, also referred to as aftermarket warranties.
Extended warranties offered by the manufacturers are the best choice since they cover wider range of repairs and services. All kinds of repairs can be done at the authorized dealerships and you get approved without any hassle.
Warranties from independent companies often cost lesser than those offered by the manufacturers, but you need to be very careful while choosing these. The limit of coverage differs from company to company and it might get difficult to locate an authorized garage. So depending upon your specific requirements, choose the right kind of extended warranty.
In most cases, getting an extended warranty is a great idea, so whether you buy a (new or old) car or lease a car, make sure you consider buying it, to safeguard yourself from skyrocketing repair bills.