How to Get a Car Loan
Most new cars come with a manufacturer’s warranty that will cover you for the first few years of ownership, typically 3 years/36,000 miles. As you finalize the paperwork for your new car, the Financing Manager will probably try to sell you an extended warranty that picks up where the manufacturer’s warranty ends. The extended warranty is a service contract for your car that covers the cost of repairs and maintenance as well as roadside assistance. When considering whether to buy an extended warranty, think about how long you plan to keep the car and how expensive servicing is for that model. Whether you buy an extended warranty is a matter of personal preference, but it can offer peace of mind against expensive car repairs.
It is important to note that extended warranties are a major profit center for car dealerships and the price is usually marked up significantly. There is no requirement to buy an extended warranty from the dealership so if you want the peace of mind, then you should save money and cut out the middle-man by shopping around online.
Keep in mind there are hundreds of types of extended warranties from many different providers and some are better than others while some are downright scams. The only way to know what you’re getting for your money is to review the actual warranty contract and buy it from a reputable source with a long track record. Price is certainly a factor, but there are many other factors you must consider in order to get a good contract. I recommend checking out Warranty Direct because they meet the criteria you should be asking about below:
Extended Warranty Considerations
- Is the provider financially stable and do they have a long operating history?
- Do they offer nationwide coverage and the ability to select the repair facility of your choice?
- Do they offer comprehensive coverage including wear and tear?
- Do they make direct payment to repair facilities or do you have to pay out of pocket first?
- Do they offer emergency road-side assistance?
- Is the warranty transferable?