Would you buy an extended warranty/service contract? How much should it cost? (insurance, vehicle)

[kanhawk]

I'm buying a new car soon and am wondering about getting an extended warranty/service contract. I've never had one before.
If you have had one, were you glad you got it? How much should someone negotiate these for?

[cdelena]

Extended warranties are insurance policies sold by the finance arm of companies. If you decide to buy one be sure to shop around the country (phone or internet) to get the best price. Buying from any dealer is as good as any other and they will compete on this high gross profit item.

They may or may not be a good value depending upon the vehicle covered and the warranty purchased. If you plan on keeping the car for an extended period and it has a risk of higher failure rate it may pay off but on average they are not a good buy for the consumer.

I bought one that was a manufacturers extended warranty and called around to various dealers to actually get a 7/100K policy at half the initial price. Although the car did not have the kind of failure I expected the warranty did pay off with needed repairs after the fifth year.

Did not purchase one with my most recent auto acquisition.

[texas_nightowl]

You know, I used to think "no way". No reason too...But, depending on the car and the options...it may be worth it these days. For those cars with Navigation/touch screens where everything, including AC is tied into the computer/MFD....well, those are pricey. So an extended warranty may not be a bad idea depending on your own financial situation.

[Hemlock140]

I have had a few over the years with mostly bad results. You have to read and understand the limitations. Most are going to cover problems caused by failure of a part, but not items that 'wear out." For example, I had one that would do a puff of smoke when starting up the first time in the morning, due to bad valve stem seals. The warranty people said they would replace the heads if they had been damaged by something like an interference belt breaking (if it had been replaced when required) but this problem was just normal wear and not covered.

Another case was a check engine light, turned out to be a slightly cracked head allowing coolant to get into the cylinder. Not bad enough to smoke
or run poorly, just enough to trigger the light. They sent a guy out to inspect it after the head was off, and determined that it was a factory defect that just took 90k miles to show up, and wouldn't pay for it.

If it had been caused by the water pump going out causing it to overheat, they would have covered it.

[Nativechief]

Its what they dont tell you when you buy one that can make you wish you didnt. Before you pay for one YOU NEED to talk with some satisfied customers and read every word of the contract and know exactly what it says,,Every little small print word..

[wit-nit]

Exteneded warranties can be a rip off. 1st the dealer/salesmen get about 50% commission for selling you one. Then there are limitations and stipulations that may negate any value to you, and if you don't perform regular maintenance schedules some will void you out.
If buying a new vehicle, forget it, you already have a warranty. As soon as the factory warranty is about to expire you'll be in-undated with offers for an extended warranty then. That's when you decide what to do. Many people sell their vehicles at the end of the factory warranty, so no need for an extended one. Used vehicles, maybe yes, but only if you understand the warranty limitations.
Me I would never buy one regardless, usually they cost more than an average repair. Many extended warranties don't cover major problems. Read the fine print. If you don't understand something make sure they spell it out to you and it's put in writing. Verbal warranties mean nothing.

[yantosh22]

These contracts are a huges waste of money. Don't buy one. Period.

[hoffdano]

Some people are crippled with fear that they will have expensive repairs for their car after the warranty runs out. So they buy extended warranties for peace of mind. Really is it spending up front for repairs. The automakers have very carefully calculated across their fleet how many repairs of each type will be required. They sell extended warranties for one reason only - to make money by taking your money now.

Maybe with some high end cars notorious for expensive maintenance - it might be worth considering. But I had a Jaguar S-type, a car with a poor reliability reputation and I drove it for 127,000 miles without an extended warranty. I spent <$2,000 for unscheduled maintenance while I owned the car. The extended warranty was over $3K.

I suggest setting aside some amount, say $500 per year, for unscheduled maintenance instead of buying an extended warranty.

If you must have peace of mind, remember that most extended warranties are a negotiable item. Do not just pay what they say it costs.

[willlix]

Through a Ford, GM Chrys.,ect & still maybe not.

Extended warranties are just insurance with far less regulation. Contracts can be difficult to understand & they are a "ponzi scheme" in some cases. It's 100% pre-paid and if they outfit goes belly up you are SOL. It happens a lot.

Take that $1500 and blow it on something you can enjoy.

[IMOGAJAD]

"But you've got to consider, there are 13 computers in this Buick. Now, you wouldn't leave your new laptop outdoors in freezing weather, would you?" That was the sales pitch for the extended warranty from the "Lie-nance Manager." Because he treated me like I was stupid, I repeatedly declined his persistent offer. Finally, he exclaimed, "Ok, name YOUR price for the warranty!" I pitched him an offer, and he agreed. I then told him, "But please give me the fine print in writing to review, and I'll get back to next week." No dice, the Lie-nance Manager demanded I buy the policy right then, as tomorrow would be too late. I passed altogether. Beware, as other posters have declared: There are tons of loopholes in extended warranties. If all they show you is a slick generic brochure, pass it up. A far better investment would be a a CAN2 OBD II scan tool. I diganosed (correctly) our 08' Lucerne at home, bought an OEM gas cap, erased the code, extinguished the check engine light and haven't had a problem since. This would not have been under warranty, and the total cost was $134.00 - $109.00 for the scan tool, $25.00 for the OEM gas cap. It would have run $100.00 at the dealership just to hook up a scan tool (1 minute or less) to tell the technician there was a vapor leak and to charge me $40.00 for a $25.00 gas cap.