{"id":11002,"date":"2021-09-23T14:06:35","date_gmt":"2021-09-23T14:06:35","guid":{"rendered":"https:\/\/www.carpages.ca\/blog\/?post_type=cp_guides&p=11002"},"modified":"2021-09-27T15:59:32","modified_gmt":"2021-09-27T15:59:32","slug":"should-i-buy-extended-warranty-on-used-car","status":"publish","type":"cp_guides","link":"https:\/\/www.carpages.ca\/blog\/should-i-buy-extended-warranty-on-used-car\/","title":{"rendered":"Should I Buy an Extended Warranty on a Used Car?"},"content":{"rendered":"\n

Car buyers spend hours researching the vehicle they want to purchase and how much to pay for it. A used car buying guide<\/strong><\/a> is an excellent source of information when it comes to making an informed decision. <\/p>\n\n\n\n

When it comes to add ons, only a few buyers will put extra effort into seeing what they can find at the dealership\u2019s Finance and Insurance (F&I) office. Oftentimes, the F&I manager is likely to offer you features such as an extended car warranty.<\/p>\n\n\n\n

Lack of preparation can cost you thousands of dollars if you do not know which add-ons are worth it and what to avoid.<\/p>\n\n\n\n

Should you consider an extended warranty on a used car? It depends on several factors. We guide you through the decision-making process below.<\/p>\n\n\n\n

What Is an Extended Warranty on a Used Car?<\/h2>\n\n\n\n
\"\"<\/figure>\n\n\n\n

The extended car warranty goes by many names, including service agreements, mechanical breakdown insurance, vehicle protection plans, extended warranties, and extended service contract.<\/p>\n\n\n\n

Extended warranties are available at dealerships when purchasing a used car or post-purchase as an aftermarket add-on. These warranties are financed or paid upfront, along with the vehicle purchase.<\/p>\n\n\n\n

The warranty covers the cost of labour and parts to repair specific vehicle components during everyday use. This means repair costs due to neglect, misuse, or accidents are not covered.<\/p>\n\n\n\n

These warranties cover repairs over a specific timeframe or for a predetermined number of kilometres. While an extended warranty may sound like a marketing gimmick, it offers value when you don\u2019t have the budget for expensive repairs later.<\/p>\n\n\n\n

Common Types of Extended Warranties in Canada<\/h2>\n\n\n\n

Two types of extended warranties exist in Canada; those from the manufacturer and those from third parties.<\/p>\n\n\n\n

1. Manufacturer\u2019s Warranty<\/h3>\n\n\n\n

A manufacturer\u2019s warranty is included in the cost of a certified pre-owned vehicle. Manufacturers often stipulate the length of these warranties in kilometres or years.<\/p>\n\n\n\n

These warranties come directly from the automaker. They are considered legitimate since you get genuine replacement parts.<\/p>\n\n\n\n

Extended warranties from the auto manufacturer come in two flavours:<\/p>\n\n\n\n

  • Powertrain warranty \u2013 A warranty covering mechanical defects because of the manufacturing process. It\u2019s also known as a limited or comprehensive warranty covering the driveshaft, transmission, and engine defects. <\/li>
  • Bumper-to-bumper warranty \u2013 The warranty does not cover items due to normal wear and tear during usage. <\/li><\/ul>\n\n\n\n

    2. Aftermarket or Third-Party Warranty<\/h3>\n\n\n\n

    These are warranties you purchase to extend coverage after the manufacturer\u2019s warranties expire. A third-party warranty is usually less expensive than a manufacturer warranty.<\/p>\n\n\n\n

    Enrolling is as easy as signing up with a reputable company to avoid online scams. Make sure you read the contract\u2019s fine print to know exactly what you\u2019re getting and the deductible.<\/p>\n\n\n\n

    What Is and Isn\u2019t Included in an Extended Warranty<\/h2>\n\n\n\n
    \"\"<\/figure>\n\n\n\n

    Expect to get emergency repairs for some vehicle components to be included in the extended warranty coverage. The exact components covered depend on the provider and plan you choose.<\/p>\n\n\n\n

    Examples of Items Covered<\/h3>\n\n\n\n

    Make sure you review the deductibles, items covered, and plans when researching extended warranty options.<\/p>\n\n\n\n

    Typical items covered under extended warranties include:<\/p>\n\n\n\n

    • Major car systems<\/li>
    • Safety features and tech systems<\/li>
    • Air conditioning and heating components<\/li>
    • Hybrid car parts<\/li>
    • Exhaust systems<\/li>
    • Alternators, manifolds, and pumps<\/li>
    • Driveshafts, axles, engine, and seals<\/li>
    • Corrosion and rust on the car\u2019s exterior<\/li><\/ul>\n\n\n\n

      Examples of Items NOT Covered<\/h3>\n\n\n\n

      You rarely get coverage for the following maintenance requirements or repairs with an extended warranty:<\/p>\n\n\n\n

      • Routine maintenance, including air filter changes, oil changes, and tyre rotations<\/li>
      • Regular wear and tear on consumables such as windshield wipers, clutches, and brakes<\/li>
      • Interior and exterior damage such as broken plastic, ripped upholstery, bumper damage, scratches, and broken glass<\/li>
      • Any damage that can be linked to installing aftermarket parts, a collision, environment, or improper vehicle maintenance<\/li><\/ul>\n\n\n\n
        \"\"<\/figure>\n\n\n\n

        Cost of Extended Car Warranties<\/h2>\n\n\n\n

        The average extended car warranty cost in Canada is between $1,000 and $2,000. What you pay depends on several factors, including:<\/p>\n\n\n\n

        • Type of vehicle you have<\/li>
        • Age of the vehicle<\/li>
        • Mileage on the vehicle<\/li>
        • Amount of coverage you need<\/li>
        • How long you want to keep the policy<\/li>
        • Whether your policy is from the manufacturer or third-party<\/li><\/ul>\n\n\n\n

          How to Pay for Extended Car Warranty<\/h3>\n\n\n\n

          You have three options for purchasing an extended warranty for your used car, these are:<\/p>\n\n\n\n

          • Rolling it into the car loan \u2013 This means you don\u2019t pay for the extended car warranty, but the interest on the loan will be higher. <\/li>
          • Upfront \u2013 You can pay for an extended car warranty out-of-pocket if you have some money saved up. <\/li>
          • Purchase it later \u2013 Some car owners prefer purchasing the extended warranty at a later date if they don\u2019t have the cash while buying the car. <\/li><\/ul>\n\n\n\n

            Why Would You Need an Extended Warranty?<\/h2>\n\n\n\n
            \"\"<\/figure>\n\n\n\n

            The first things you need to evaluate have nothing to do with the vehicle you are purchasing.<\/p>\n\n\n\n

            You need an extended warranty if:<\/p>\n\n\n\n

            • You\u2019re worried about the expenses you might face after the car\u2019s warranty expires<\/li>
            • Costly car repairs will make it hard to pay for essentials such as utilities, rent, or food<\/li>
            • You put so much mileage on the car annually that you blow through the manufacturer\u2019s warranty quickly<\/li><\/ul>\n\n\n\n

              However, you can skip an extended warranty if you are a disciplined saver. This means creating an untouchable car emergency fund that\u2019s set aside for unexpected car expenses and repairs.<\/p>\n\n\n\n

              Make sure you are aware of both the advantages and disadvantages of an extended warranty before you decide.<\/p>\n\n\n\n

              Advantages of Extended Warranties<\/h3>\n\n\n\n

              We recommend an extended warranty on a used car to cover unexpected repairs. These warranties provide several benefits, including:<\/p>\n\n\n\n

              • Not paying for expensive repairs out of pocket \u2013 Most extended warranties cover repair bills, towing costs, roadside help, and even rental car reimbursement. <\/li>
              • Peace of mind on the road \u2013 An extended warranty lets you anticipate the warranty cost minus the deductible is all that\u2019s required to keep the car on the road. <\/li>
              • Keep the vehicle for years knowing it\u2019s protected \u2013 Extended warranties help you keep your priced used car for years by covering repair costs. <\/li><\/ul>\n\n\n\n

                Disadvantages of Extended Warranties<\/h3>\n\n\n\n

                Unfortunately, extended car warranties are not the best fit for everyone. Some demerits include:<\/p>\n\n\n\n

                • Extended vehicle warranties don\u2019t cover everything \u2013 Claims can be denied if your contract doesn\u2019t cover a part or breakdowns. So make sure you read the contract before signing. <\/li>
                • Expensive when you don\u2019t use them \u2013 You might put more money into the extended warranty than what you spend on repairs. <\/li>
                • Deductible \u2013 Filing a claim may require paying hundreds of dollars depending on your deductible. <\/li><\/ul>\n\n\n\n

                  When to Consider a Used Car Extended Warranty<\/h2>\n\n\n\n
                  \"\"<\/figure>\n\n\n\n

                  No law requires car owners to have an extended warranty. Therefore, you can drive as much as you want as long as you meet the minimum automotive insurance level. <\/p>\n\n\n\n

                  A used car extended warranty should save you more money than you would otherwise spend covering out-of-pocket repairs. This warranty is beneficial under certain conditions. <\/p>\n\n\n\n

                  For instance: <\/p>\n\n\n\n

                  • When you are purchasing an older car that requires more service as it ages. <\/li>
                  • If the vehicle make and model has a history of service requirements. <\/li>
                  • When a used vehicle comes from the dealership with an extended warranty included. <\/li>
                  • If you have a newer model vehicle that comes with specific service requirements. <\/li>
                  • When you are looking to leverage extra perks, such as roadside assistance that comes with an extended warranty. <\/li><\/ul>\n\n\n\n

                    An extended warranty is not valuable until you need it. Therefore, you may spend more money on the warranty unless it kicks in and reduces your repair costs. <\/p>\n\n\n\n

                    We recommend you set a budget and find an extended used car warranty cover that balances costs and the coverage you want. Make sure you find a plan you\u2019ll use regularly. <\/p>\n\n\n\n

                    Other factors to consider before getting an extended warranty include: <\/p>\n\n\n\n

                    • Vehicle maintenance costs and ownership length<\/li>
                    • Whether you pay for it upfront or roll the costs into the auto loan<\/li>
                    • Coverage of the warranty<\/li>
                    • Whether it covers used electric cars<\/strong> and the extent<\/li>
                    • The deductible policy and the issuer\u2019s reimbursement method<\/li>
                    • Where you can get the car serviced<\/li><\/ul>\n\n\n\n

                      Is an Extended Warranty Worth it on a Used Car?<\/h2>\n\n\n\n

                      An extended warranty on a used car is an excellent investment when you don\u2019t have an emergency fund and anticipate significant vehicle repairs soon. However, extended warranties can be expensive and might not cover all the repairs required. Compare different policies to get the best rates and read the fine print before signing up.<\/p>\n","protected":false},"excerpt":{"rendered":"

                      An extended warranty can help reduce the financial stress of unforeseeable costs. Take a look at whether you should consider an extended warranty on a used car.<\/p>\n","protected":false},"author":38,"featured_media":11005,"template":"","categories":[1,2],"class_list":["post-11002","cp_guides","type-cp_guides","status-publish","has-post-thumbnail","hentry","category-guides","category-popular"],"acf":[],"yoast_head":"\nShould I Buy an Extended Warranty on a Used Car? - Carpages Blog<\/title>\n<meta name=\"description\" content=\"An extended warranty can help reduce the financial stress of unforeseeable costs. 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