Love or Hate? Decoding Extended Warranties in Car Finance
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- Опубликовано: 7 июн 2024
- Car buying and extended warranties from the finance office! Love them or hate them, I scratch the surface by explaining how they're built and answer common questions.
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All photos are royalty free and fair use. Sounds and music are creative commons use.
Time Stamps:
00:00 Intro
00:09 Note - This video
00:44 History brief
03:53 Extended warranties!
04:00 Sidecar - true warranty
04:34 The business
04:57 My disclosure rant
06:06 New cars “limited” & “terms”
07:15 How they get there
08:28 Exclusionary
09:15 Administrators & brands
09:53 Who has what?
10:12 Marking them up
10:31 Can I wait?
10:53 How they are built
11:44 Customize
12:42 Used stated
13:19 Don’t do this
13:52 Levels
14:12 Deductibles
14:26 Additive in term?
14:54 Manufacturer CPO warranties
15:34 “Lifetime” warranties
16:21 Reviews & alternatives
17:02 Cancel clause
17:25 Transfer
17:56 How to cancel
"Kimberly, I did so good on negotiating the price of the car down and getting a fair Out The Door price. But then.... I don't know - they really got me in the finance office." - This is what I hear from people every day.
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👇 IMPORTANT DISCLAIMER :
*This video is my own opinion based on my professional experience. I am not a Financial Advisor or Attorney. Please seek one if you feel you need legal or financial advice.
**Licensed and/or creative commons use of sounds and media. 
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Can you do a video on leasing vs buying? Thank you for your informative videos.
Yes! Do a live. I am there for it!
On a less sarcastic note, LOVE this Video Kimberly! So informative, love the history that is fascinating, I bet Ford wishes they could go back to that original warranty right now!!
OH..... time traveling Kimberly! Someone got her flux capacitor working!!!
You're a blessing Miss, thank you!
Your videos are so helpful. Keep doing the great job !
Thank you for another knowledgeable and informative video!!
Thank you Kimberly for the history of warranties. It was very informative...
Thanks for the info. Every car buyer should watch your videos.
Thank you for the good information. Will be buying a new car soon. I’ve learned a lot. Thank you.
Always GREAT information.....A BIG Thanks & a Thumbs Up
EXCELLENT! You offer EDUCATION for people to be informed and make up their OWN mind. I have done it both: Bought a VSC and not used it and NOT bought a VSC and should have! I think of it as 'insurance' - just like auto, home, health or life insurance policy coverages/options.
Good info! My very first new car came with a 12mo/12k warranty. At about 12,050 miles the automatic transmission went out. The dealership did finally cover it under their "goodwill" policy.
My current vehicle is a compact car 8 years old with 140k. Still have 1.5 years and unlimited miles of coverage.
Bought coverage through credit union where I always finance.
Has paid reliably and not tied to dealer service, but any ASE shop.
I'd recomend at least having the info on a plan like this before shopping.
Get the total cost not monthly cost at dealership.
Great job Kimberly , you could not have explained it any clearer.
I have never been a fan of VSC...even when I was selling cars. More stories of things not be covered than were. The few times I have had them, either nothing ever broke, or what did break, took some arm twisting to get it covered. Now, with vehicles being so complicated and costs through the roofs, I am a fanboy. My local mechanic is also a fanboy. Absolutely, shop around. We just bout a 2024 GTI. Shopped all around. Talked to 8 different companies including 3 different VW dealers. The worst ones for coverage were the ones with HUGE TV Ad buys (and paid celebrity endorsements). The best value turned out to be the one through our Credit Union. Many of the other Dealer add-ons were included. Dealer F&I person made a half hearted attempt at winning our business. I believe they could sense our decision to never darken their doorway again.
Huffines Hyundai in Plano, Tx would not honor my factory warranty.For emissions saying they did a computer update so they would not honor the warranty. They did not replace apart. So they made me pay it. They did a computer update
I’ve bought it on our last 2 cars and have had claims at some point on both and have never been denied. Knock on wood. Was it worth it? I believe so. And the feedback about never using it, same as car insurance. 🤷♂️
My 1979 Mustang Indy Pace Car edition had a one year, 12,000 mile warranty.
Beyond the bronze, silver, gold, and platinum plans, there is now a plutonium plan! Coverage goes down by half every year, and eventually they nuke your coverage!
(OK, I had to give you a little chuckle there! 😀)
Just found out that in Florida VSCs are considered insurance products and are non negotiable.
Bought the extended warranty for a Toyota 4x. Everyone said 'What? Its a Toyota, why would you do that???😂' Transfer case went out, warranty covered the cost of the new replacement and labor at the dealership. Almost 7k for the entire job.
First, excellent knowledge.. Second, i noticed you dont have a wedding ring.. How is that possible?? you are gorgeous and your knowledge is so valuable. Someone get a ring on this beauty.
Hi! Where can I find the actual prices on the extended warranties? Thanks!
As a person who worked in the business for a decade. There are some very unscrupulous people who sell these "products". Some aren't worth the paper that they're written on. Others are VERY worthwhile, even if you never use them. Sort of like any insurance policy. You hope you never have that crash or your house on fire, but it at least is some comfort knowing that not everything will be bad if it does happen to go wrong. For example at one place I worked we had 15 different plans to choose from. out of those only 3 did I ever recommend. My daughter has one on her new car and she has the piece to know any major expense is covered for 7 years, with an option to extend, if she's taken care of the car according to the manual. To all the people who say NEVER buy one, are they going to pay for the work to be done? Or the choice of the major car bill vs paying other bills. Nope! If you have a ton of money just lying around, then don't worry about it. Otherwise, you'd be wise to at least seriously consider and research the proper warranty for your car.There are many things to look out for, more than a comment can cover.
Dear Kimberly, I've never been a fan of VSC's but mostly due to all the bogus phone calls from India about extended warranties. How can I tell a reputable VSC from one that isn't?
I am still confused as to why the VSC runs concurrently with the factory warranty. Why must I pay for no VSC coverage during the factory warranty period? What am I missing here?
Question: if a person buys a new 2024 vehicle, but puts in an aftermarket sound system, can that impact any of the warranty?
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Kimberly, the CarEdge VSC has a good administrator based on your experience, but who does the work on my vehicle? a dealer? using OEM parts?
Hi @jackzigon Since it is through a dealership administrator (just like many others...fidelity, zurich, easycare and so on) go to any dealership or ASE Certified Mechanic of your choice. They will use LKQ (like, kind quality parts) without the manufacturer stamp or you have the option to wait or use the oem stamped part & pay a difference if there is one. Do go over the actual contract linked below first. Call CarEdge w/any questions first as well. New & newer vehicles will be the exclusionary Supreme Plus and older, higher mileage vehicles will be Supreme, Premier & Powertrain. I do not get paid, I just know it well ✅
caredge.com/wp-content/uploads/2024/03/Sample-Contract.pdf
I looked up some statistics.
2.7% is the rate for warranty claims.
Extended warranties have a 6.7% claim rate.
A majority of claims made under an extended warranty have a lower cost than the cost of the plan.
An extended warranty or VSC is only really worth it if you can't afford a sudden $1000+ repair bill.
The odds are that most people will never use a VSC.
About 5% of people who have home owners insurance submit any claim. But we still all have the option to purchase it if we want to.
My late grandfather was a lawyer and had this joke about insurance (which in a way applies to these warranties): You are making a bet with the company that something bad will happen to you. They are betting that it won't, but you are the one paying for the privilege.
@@ronj9124 that is what all insurance is. The nice thing is that you have the choice to make.
Never purchased an extended warranty. I’d I did would want the one issued by the manufacturer.
I've owned Chrysler cars my whole life (40 years) and i always purchased a service contract directly from MOPAR. and i ALWAY buy the MAXI_CARE (best one). I probably spent more on the coverage than the repairs cost. But it gave me one thing that's very important to me....PIECE OF MIND!!!!!!.......If you buy a VSC then ONLY buy from the company that built the car...you'll never go wrong
I am sorry but third party extended warranties are crap. My brother oversees service and parts departments at three different dealerships (same group) and they are a royal "pain" to deal with frequently his dealership refuses to work on vehicles that have these contracts. They notoriously don't want to pay anywhere near the going rate for labor or parts and frequently want the repair shops to use used or after market parts for repairs.
Another one of the common practices is to find any little thing to deny a claim. Read the fine print in the contract closely and I guarantee you will not be impressed.
Having said that about third party contracts, manufacturer extended warranties have a much better track record but beware, you better keep up with the recommended maintenance schedule for your vehicle because if you don't even they will use this as a reason to deny the claim.
For most individuals, these extended warranties are not a good deal. They provide a degree of comfort for the buyer who thinks in his or her mind that this extended warranty will be just like the warranty they received with their new car. WRONG!
These lifetime warranties from some dealerships are such a scam. They are so full of exclusions...
This was a little disappointing, Kimberly. You explained how VSCs work, but you said not one word about HOW WELL they work (OR DON''T) for most people. A number of other RUclipsrs with automotive experience aren't hesitant to share that VSCs are generally a poor value for most people. They are typically marked up 100% or more and provide, on average, 40% or less of the price paid in covered repairs. Consumer Reports and others suggest earmarking the money that would have been spent on a VSC and putting it in the bank as a form of self-insurance. I think you know way more than you're saying, and it would be kinder of you to share your informed opinion with us.
She said MORE info to come on this topic
@@cristiti7481 She plainly did. 😊
She said you can have your own auto repair account and bank your VSC money in that account
She literally said it. 16:50
Maybe listen to the video she said it
talk about mandatory arbitration
No hate but 3 words: not worth it.
Not even counting the reputation for denying coverage