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Old 03-23-2015, 06:13 AM
 
Location: Midwest
978 posts, read 2,039,637 times
Reputation: 801

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Question about those warranties. I generally NEVER buy them as repairs, even 10 years down the road are rarely more than the cost of the warranty (although certain brands of cars may be different). However, on my last car purchase I did inquire about it. The dealer said that it was not a factory extended warranty, but something from CareGard (or maybe it was another company). Are these warranties usually from the manufacturer or from another company?

If I intended on keeping a car for a long time, I maybe would consider getting an extended warranty, but only if it's directly from Toyota, Honda, etc.
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Old 03-23-2015, 06:40 AM
 
922 posts, read 1,139,342 times
Reputation: 1195
Quote:
Originally Posted by MadManofBethesda View Post
You better be careful what and who you are calling dumb. Monthly payments most certainly can be contractually obligated. Your mortgage payment is a good example of that. If you have a 30yr 200k mortgage at 4%, you have a P&I mortgage payment of $955/month. The mortgage papers you sign state that you will pay that exact amount for the duration of the loan. If you subsequently decide to write your bank a check for $100k to cut your mortgage in half, you are still contractually obligated to continue to make monthly payments of $955. The only difference is that your mortgage obviously will be paid off in fewer years, but your payment remains the same.

I feel like I'm in the Twilight Zone....

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Old 03-23-2015, 06:41 AM
 
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
44,054 posts, read 80,100,596 times
Reputation: 56828
Quote:
Originally Posted by mangoarrow View Post
Wow this guy must sell warranties for a living.

First of all ext warranty is pure profit because majority never use it. Who gets the profit depends on who is offering it of course.

Secondly, canceling the warranty will indeed lower monthly payments since the money borrowed is reduced by nearly $2k.

Dont listen to this warranty salesman and cancel it ASAP.
No, we have been this route. The refund is credited to the balance, but does not affect the payment amount. It simply lowers or eliminates the last payment.
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Old 03-23-2015, 06:51 AM
 
922 posts, read 1,139,342 times
Reputation: 1195
Quote:
Originally Posted by attrapereves View Post
Question about those warranties. I generally NEVER buy them as repairs, even 10 years down the road are rarely more than the cost of the warranty (although certain brands of cars may be different). However, on my last car purchase I did inquire about it. The dealer said that it was not a factory extended warranty, but something from CareGard (or maybe it was another company). Are these warranties usually from the manufacturer or from another company?

If I intended on keeping a car for a long time, I maybe would consider getting an extended warranty, but only if it's directly from Toyota, Honda, etc.

The only way to justify the cost of an extended warranty is if both your engine and transmission conk out between 60k-100k miles. The odds of that happening is probably the same as being hit by lightening or being eaten by a shark. Had I gotten an extended warranty for all my cars, I'd have flushed $20,000 down the toilet.

CareGard is 3rd party and not backed by the manufacturer. I'd stay away as I still remember the "Warranty Gold" fiasco.
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Old 03-23-2015, 06:55 AM
 
Location: Birmingham
11,787 posts, read 17,634,822 times
Reputation: 10119
Quote:
Originally Posted by mangoarrow View Post
Might as well get shark and lightening insurance too. I mean, they could happen too right?

Yes, extended warranties are like insurance.... unnecessary insurance. When insurance isn't cashed in, guess what? 100% of it goes to the issuer. Like I said, pure profit.

There are extended warranties offered by manufacturers, 3rd party and dealers. Bulk of it goes to whoever issued it.

So you think financing $25k and $23k (at 0%) equals same exact monthly payments? ON what planet? Certainly not Earth.
Then drop your car insurance then. Oh wait...

Nice backtrack. When you said "pure profit" you implied that the dealer kept the whole premium. 2000 warranty? 2000 profit for the selling dealer which is false. Now you at least understand the dealer and underwriter relationship. If he doesn't have a claim yes its profit. But what if he does? Walk behind any dealership of the brand of your choice and guess what you'll find? A shop full of broken ones. And no they aint all back there getting oil changes and new wiper blades and they wont all be antiques. Cars do break. I thought the premium he paid for a 100k wrap warranty was a bit high but when you factor in the whole deal he came out ok especially when he said his old Saturn was a plug and he got more for it then he thought it was worth.

And no kidding a loan payment on 25k is higher then one on 23k. The difference is he is not recontracting when the warranty refund comes in.

The bottom line is the OP is happy with the deal.
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Old 03-23-2015, 06:59 AM
 
922 posts, read 1,139,342 times
Reputation: 1195
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Originally Posted by Hemlock140 View Post
No, we have been this route. The refund is credited to the balance, but does not affect the payment amount. It simply lowers or eliminates the last payment.
We're talking about $2k, which is much greater than 1 month's payment. So you're saying the bank would take 7 months off the back end? No, it doesn't happen like that.

I've had the APR and amount financed changed and the payments were always lowered to reflect that. Banks want the payments to be 24, 48, 60 month increments, not 17, 41, 53.
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Old 03-23-2015, 07:00 AM
 
Location: Birmingham
11,787 posts, read 17,634,822 times
Reputation: 10119
Quote:
Originally Posted by attrapereves View Post
Question about those warranties. I generally NEVER buy them as repairs, even 10 years down the road are rarely more than the cost of the warranty (although certain brands of cars may be different). However, on my last car purchase I did inquire about it. The dealer said that it was not a factory extended warranty, but something from CareGard (or maybe it was another company). Are these warranties usually from the manufacturer or from another company?

If I intended on keeping a car for a long time, I maybe would consider getting an extended warranty, but only if it's directly from Toyota, Honda, etc.
The law is very clear. An extended warranty CAN ONLY be offered by the manufacturer and it is usually only offered when the car is new or when buying a certified pre owned.

When you buy a used car from joe blow motors or a competing brand they are legally called extended service agreements or contracts or something to that effect but never WARRANTY. These are offered from 3rd party companies.

No one can make a blanket statement about these. They vary wildly from great to pointless.
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Old 03-23-2015, 07:09 AM
 
922 posts, read 1,139,342 times
Reputation: 1195
Quote:
Originally Posted by Tourian View Post
Then drop your car insurance then. Oh wait...

Nice backtrack. When you said "pure profit" you implied that the dealer kept the whole premium. 2000 warranty? 2000 profit for the selling dealer which is false. Now you at least understand the dealer and underwriter relationship. If he doesn't have a claim yes its profit. But what if he does? Walk behind any dealership of the brand of your choice and guess what you'll find? A shop full of broken ones. And no they aint all back there getting oil changes and new wiper blades and they wont all be antiques. Cars do break. I thought the premium he paid for a 100k wrap warranty was a bit high but when you factor in the whole deal he came out ok especially when he said his old Saturn was a plug and he got more for it then he thought it was worth.

And no kidding a loan payment on 25k is higher then one on 23k. The difference is he is not recontracting when the warranty refund comes in.

The bottom line is the OP is happy with the deal.

Never backtracked. It is PURE PROFIT for the dealer however you look at it. Did the dealer purchase the warranty and would lose the money if no one is tricked in to buying it? Nope, but when they do sucker one in to buying it, they receive a big fat commission check. Amount varies depending on whether they are the ones backing it or not.

Only car salesmen, lienance managers and warranty salesmen think it's a good idea to get extended warranty (Which one are you?). Ask any financial adviser and they'll tell you it's a waste of money.

Not Just the Scams: All Extended Auto Warranties Are a Bad Deal - CBS News

Please tell us how the payment stays exactly the same when you are financing $23k and $25k at 0% for 48 months.
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Old 03-23-2015, 07:17 AM
 
922 posts, read 1,139,342 times
Reputation: 1195
Quote:
Originally Posted by Tourian View Post
The law is very clear. An extended warranty CAN ONLY be offered by the manufacturer and it is usually only offered when the car is new or when buying a certified pre owned.

When you buy a used car from joe blow motors or a competing brand they are legally called extended service agreements or contracts or something to that effect but never WARRANTY. These are offered from 3rd party companies.

No one can make a blanket statement about these. They vary wildly from great to pointless.

Technically, yes. But 3rd parties have been selling extended warranties on new cars for years, they just call it "vehicle service contract" instead of warranty.
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Old 03-23-2015, 07:22 AM
 
Location: Birmingham
11,787 posts, read 17,634,822 times
Reputation: 10119
Quote:
Originally Posted by mangoarrow View Post
Never backtracked. It is PURE PROFIT for the dealer however you look at it. Did the dealer purchase the warranty and would lose the money if no one is tricked in to buying it? Nope, but when they do sucker one in to buying it, they receive a big fat commission check. Amount varies depending on whether they are the ones backing it or not.

Only car salesmen, lienance managers and warranty salesmen think it's a good idea to get extended warranty (Which one are you?). Ask any financial adviser and they'll tell you it's a waste of money.

Not Just the Scams: All Extended Auto Warranties Are a Bad Deal - CBS News

Please tell us how the payment stays exactly the same when you are financing $23k and $25k at 0% for 48 months.
I know it pains you that businesses profit when you buy goods and services but that is how our economy works. Sorry.

One silly link by one reporter is meaningless to me.

You don't understand what a contract is. If he cancels now it will just chop some payments off the back end of his loan. His monthly payment will stay the same. The end. He would have to refinance to change the payment. Good luck getting 0% on a used car.
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