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05.04.2023Does an extended warranty on your car worth it? Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our aim is to assist you make smarter financial decisions by offering interactive financial calculators and tools that provide objective and unique content, by enabling users to conduct research and compare information for free — so that you can make informed financial decisions. Bankrate has agreements with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make money The products that appear on this website are provided by companies that pay us. This compensation may impact how and where products appear on the site, such as, for example, the order in which they may appear in the listing categories in the event that they are not permitted by law for our mortgage and home equity products, as well as other home loan products. This compensation, however, does affect the content we publish or the reviews that you see on this site. We do not cover the universe of companies or financial deals that might be available to you. Aaron Greene/Getty Images
3 min read . Published November 28th, 2022.
Writer: Jackie Lam Written by Contributing writer Jackie Lam is a contributing writer for Bankrate. Jackie writes about auto loans. Written by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since the end of 2021. They are passionate about helping readers to control their finances by providing concise, well-studied information that breaks down otherwise complex topics into manageable bites. The Bankrate guarantee
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This compensation could affect the way, location and when products appear within listing categories in the event that they are not permitted by law. This is the case for our mortgage or home equity products, as well as other home lending products. Other factors, such as our own rules for our website and whether the product is available within the area you reside in or is within your own personal credit score may also influence the way and place products are listed on this site. We strive to offer a wide range offers, Bankrate does not include specific information on each credit or financial product or service. An extended car warranty can protect you from financial stress in the event that your vehicle needs unexpected repairs. What is the best way to determine if an extended car warranty worth the cost? This largely depends on the specifics of the warranty as well as your specific needs. How much will an extended car warranty cost? When it comes to extended warranties for cars price is the primary factor. Extended warranties are priced differently and range from a median of between per year. The cost is contingent on several factors, such as: The provider. What’s covered by your current warranty. The model, make and year of your vehicle. The mileage of your car. The location you live in and how much you drive. Cost of replacing components and labor. Discounts that you qualify for. Other aspects that affect the cost of an extended warranty include the length of coverage, the extent of coverage, and the deductible. The higher your deductible, the less the price of the insurance. However less your deductible is, higher the cost. Be aware that if you pay for your extended warranty with an auto loan then you’ll be paying not only for the warranty, but also interest on the amount. What exactly does an extended warranty provide? A warranty extended to your vehicle typically covers unforeseen, expensive repairs involving major systems of the vehicle, such as heating/air, engine, and brakes. Your exact coverage will depend of the type of warranty that you buy, and may include parts, labor or both. Certain extended warranties provide protection for roadside assistance tire replacement, and other expenses related to your vehicle that you might encounter. Extended car warranty drawbacks While an extended warranty for your vehicle could possibly help you save the cost of expensive repairs, let’s take a look at some of the cons you might encounter when purchasing one. There aren’t all repairs covered. Because an extended car warranty generally matches the brand new car’s warranty, it also reflects the limitations such as mileage and the types of repairs covered. Look at the fine print as well as the exclusions list to determine the extent of coverage worth the cost. There is a time limit for extended warranty on cars are only valid during the duration in the extension of warranty. In other words, it could prolong your warranty for two years and 24,000 miles. If you began with a warranty that was one year and 36,000 miles. That will mean that the entire warranty is five years and 60,000 miles. You might not use it Among those who did hop onto an extended warranty, only 45 percent of them tapped onto their warranty extension, according to a . The remaining 55 percent did not. Those who purchased one and used it experienced a net gain of greater than $375. It’s possible that you don’t need it in the first place. Check the track record of the vehicle you want to purchase by doing your own research, which includes reviewing reviews on cars, recommends Renee Valdes, senior advice editor at Kelley Blue Book. «If the vehicle boasts a , think twice before signing to extend the guarantee,» says Valdes. That money could be used instead for. Emergency savings can cover any repair to your car that is not that are covered by the extended warranty — and there’s no expiration date. If it’s logical to purchase an extended car warranty. An extended car warranty can only be used in very specific circumstances. Extended warranties may be beneficial for those who intend to use their vehicles for years beyond the bumper-to-bumper and powertrain warranty, Valdes adds. «There’s nothing more frustrating than being confronted with a large cost for a damaged item on your car that there’s no warranty to cover the item,» says Valdes. If the manufacturer’s warranty has expired then it could be a good idea to hop on an extended car warranty. The manufacturer’s warranty information can be found on the tag that is on the vehicle’s window. If you can afford to purchase a warrantee, it can help to cover repairs that are covered. It’s beneficial to find out what the costs will be during the first years of ownership. To avoid costly repairs, make sure you stay in the loop with your vehicle’s maintenance. «It’s always best to keep up with maintenance on your car so that overall repair costs are low for the period you own the vehicle,» says Valdes. The bottom line: An extended warranty for your vehicle isn’t suitable for all. To determine whether an extended warranty worth it, do your homework and get some quotes. Research what repairs your vehicle will require in the next few years, and ensure that they’re covered under a specific warranty.
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Written by Contributing writer Jackie Lam is a contributing writer for Bankrate. Jackie is a writer on auto loans. The article was edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since late 2021. They are enthusiastic about helping readers gain confidence to take control of their finances through providing clear, well-researched information that breaks down otherwise complex topics into manageable bites.
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