What is an extended warranty? And how do you know if you need an extended warranty? If you’re buying a car, and not totally sure about the answers to these questions, then read these helpful facts below – they’ll help you make a more informed decision about purchasing an extended warranty and potentially saving big money on expensive repairs.

What is an extended warranty?

An extended warranty is a “prolonged” warranty for car owners that goes beyond the initial warranty plan offered by the dealer.

What is covered under an extended warranty plan?

Generally, a warranty plan covers repair costs associated with electrical and mechanical breakdown. The most common areas covered by an extended warranty include: the engine, transmission, rear wheel and front wheel drive, brakes, steering, electrical systems, suspension and air conditioning.

What is NOT covered under an extended warranty?

The majority of extended warranty plans will not cover non-electric or non-mechanical issues such as general wear and tear of the automobile, normal maintenance issues or theft.

Other significant expenses covered by extended warranties

One of the many positive things about extended warranties is the fact that they often cover expenses associated with repair that you might not have considered, including the cost of having your car towed and even rental car expenses during the time in which your car is being repaired.

Do I need to purchase an extended warranty at the time of purchase?

Most extended warranties do not need to be purchased before you drive off the lot with your new car. However, to get the best price on an extended warranty plan, it is a good idea to buy in as soon as possible. The price of many plans goes up after a certain number of miles have been logged on the car.

What happens to the extended warranty if I decide to resell my car?

Another great thing about major extended warranty programs is that they are transferable. Therefore you can increase the value of your car when selling it to a private party.

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