The Importance of Buying an Extended Warranty with your Used Car Purchase

Planning to buy your next vehicle from a used car dealership? You’re not alone; around 41 million used vehicles were purchased in the United States in 2016.

Buying from used car dealerships is continually popular for a number of reasons, not the least because it’s a terrific way to save money. We all know many new vehicles are overpriced, and simply don’t appeal to the countless drivers who just want a solid, reliable car without the added features or gizmos inflating the cost.

Purchasing through used car dealerships is also far more reliable and secure than buying from a private individual, with regulations in place to protect consumers. On top of this, their dealers are well-trained, knowledgeable, and will certainly let you take a test drive before you finalize a purchase.

Still, one big question you might have about buying a used car from a dealership regards your warranty. Many dealers provide one of several types of standard warranties, varying from partial to full, with or without a co-pay, and within a specific number of months or miles, although this may not offer much coverage in itself. An extended warranty, though, may be available at an additional cost. If so, it is usually well worth choosing one of these to give you assurance that you won’t be faced with unexpected high repair costs during the term of the warranty.

What is an Extended Warranty?

An extended warranty (also often known as a service contract) is basically an insurance policy on your used car. Investing in one will provide you with more peace of mind and reassurance in the event of future problems. 

The money you spend on your used car is invaluable, and you never know what’s around the next corner. The thought of a breakdown in the middle of a busy highway or a faulty transmission as you’re heading to an important meeting is enough to inspire dread in even the most experienced driver. Not everyone can find the money for a repair or new parts on the spot, especially with other responsibilities and expenses devouring your income.

Even if you buy the least expensive vehicle available at the dealership, you should discuss the possibilities of buying an extended warranty for your car. Here are some of the key benefits.

Better Coverage Overall

Most reliable used car dealers will give you some type of a warranty on your purchase anyway, but an extended one brings greater protection overall. Should your vehicle experience any mechanical faults, your standard warranty may only cover a small amount of the cost, leaving you to foot the rest of the bill. At times, this is simply impossible, and if you depend on your car every single day, your lifestyle could undergo drastic changes.

An extended warranty will normally provide you with much more coverage, and for a longer time than the dealer’s warranty that comes with the car. As a result, you’ll have more money to focus on other areas of your life, or to put aside for an upgrade on future vehicles.

Your Contract May be Transferable

Depending on the provider you choose, your extended contract may even have a lifespan greater than the amount of time you expect to own your car. Perhaps you always buy used cars rather than new ones, or you’ve simply invested in a second-hand vehicle to save money until you can afford to upgrade. Either way, you might only expect to have this one for a number of months before moving on to another model. You may even be able to transfer your extended warranty to your next vehicle, if it hasn’t already expired. If you able, this can provide even greater peace of mind in years to come, and save you from having to invest in a second extended warranty (or service contract) on top of the car’s price. This could be a big advantage if you choose to invest in a used car at a low price to cover a short period of time (perhaps while you save).

Boost Your Car’s Resale Potential

Selling your used car can bring in some much-needed funds, especially towards your next model, but you can increase the value of the car with an extended warranty. Not only does this provide your buyer with the same reassurance and peace of mind you’ve enjoyed, it also demonstrates that their purchase has been well-maintained during your ownership. You can maximize this selling point by taking them on a test drive to show how well it still performs. An extended warranty may be ideal for potential buyers too, as they could be concerned about costs themselves, and this can help make your used car stand out from others on the market. 

Saving Money in the Long Term

You have certainly heard that old cliché about having to spend money to make money. Well, it’s certainly true here. Paying for your extended warranty may be an expense, but it may save you money in the long run. An insurance or service policy on any item, such as your phone or your computer, for example, can seem unnecessary until something goes wrong and you can’t afford a new one. Your extended warranty reduces the risk of finding yourself faced with an overwhelming bill in the unlikely event of a serious problem.

Discuss an extended warranty with your used-car dealer to find out your options. They may be able to offer you a special deal depending on the price, and provide you with real peace of mind to help you enjoy driving your new vehicle that little bit more. If you’re unsure how advantageous it will be on your specific car, don’t be afraid to ask, they’ll be only too happy to go over it with you in detail.

An extended warranty could make all the difference to your experience of driving and maintaining your used car. The initial expense far outweighs the potential costs of repairs or replacement parts, and may add to the value of your purchase in the future.