How to Save Money with a Car Warranty or Service Contract, and Where to Get One

Thanks for Visiting my hub on car and truck warranties. Basically, once you become an adult, a car is pretty much a necessity. However, vehicle maintenance can be quite expensive. However, you can cut down on that cost and the overall cost of car ownership with an automobile warranty. (And if you find this helpful or informative, please visit my other hubs on Home Warranties and Warranties and Protection Plans for Electronic and Devices.)

A warranty is a commitment - usually from the manufacturer - that a given product will work or function properly for a certain period of time. If it doesn't, the manufacturer typically repairs or replaces the item for free.

In essence, this is how automobile warranties work as well: the car manufacturer basically promises to fix the car if it has any problems within a certain time period or before being driven a certain number of miles. For instance, a car manufacturer may offer a 36-month/36,000 mile factory warranty. Thus, if the car has any issues within the first 3 years of ownership or before being driven 36,000 miles, the manufacturer will fix the problem at no cost to the owner.

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An extended warranty (technically, a "vehicle service contract"), can basically be viewed as a supplement to the manufacturer's warranty. It offers vehicle protection in the form of repair services, and is typically designed to pick up at the point where the manufacturer's warranty comes to an end.

For instance, if a manufacturer's warranty ends at 36 months/36,000 miles, an extended warranty will pick up at the point, and may go to something like 72 months/100,000 miles. However, whereas the manufacturer's warranty comes with the vehicle, an extended warranty is an item that has to be purchased separately.

Still, as anyone with a car knows, vehicle maintenance is expensive. Moreover, taking a vehicle to a mechanic to inspect one problem invariably leads to the mechanic finding several other things wrong. Because it can essentially cover all major repairs (even the hidden ones that mechanics always find), an extended warranty usually pays for itself many times over by the time it eventually expires.

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When buying a new car or truck - and often when purchasing a used one - the dealer will usually ask if you are interested in getting an extended warranty. The answer to this question should always be "yes". This is typically thei first place to look in terms of getting an extended warranty.

Of course, no one is saying that the dealer is offering you the best warranty deal out there. In fact, you can almost rest assured that you can find something cheaper. The primary benefit of getting the service contract from the dealer is that usually you can finance the cost of the warranty by rolling it into the price of the car. As decent warranty contracts can often run well over $1000, this is definitely something that merits your consideration. However, as already noted, the savings will more than pay for the contract in most instances. Moreover, you can usually take your vehicle to virtually any mechanic you want for repairs.

If you choose not to buy an extended warranty from the dealer who sold you the car or truck, you still have many options. First of all, the warranty department at a dealership is usually separate and distinct from the vehicle sales department. Thus, you can usually call the warranty department at any dealership - even one where you didn't buy you car - and get a quote on a vehicle service contract.

Likewise, you can search online for a good deal. There are many reputable warranty companies that have an online presence (as almost everyone does these days), so finding one shouldn't be an issue. Then its just a matter of determining the covergae you want and what the price will be. Personally, I usually try to get the most extensive coverage available. For a few hundred dollars more you can usually get several years and thousands of miles more in coverage. To me, that's a good deal.

It may come as a surprise to many, but you can actually get an additional extended warranty to cover your car or truck even though you may have high mileage. The coverage is not likely to be nearly as extensive, but you can usually cover the major systems - typically for another 100,000 miles or so - and thereby continue to reduce your out-of-pocket costs for repairs.

Be wary, however, as this is a range of coverage where service may not be of the same quality as it was when your mileage was lower. Moreover, you'll probably want to start looking and - if possible - get the new policy before coverage under your existing policy expires completely. In other words, if your coverage is for 100,000 miles and you're at 90,000, it's a good time to start looking.

As was the case with earlier warranties, a high-mileage warranty will more than likely save you money in the long run.