Financial Education (US)

Car warranty: is it worth it and what is a good price?

Today, you'll find out if it is worth getting a car warranty to have your rights guaranteed in case of vehicle problems. Learn all about it here!

Advertisement

by Aline Augusto

Published on 03/01/2022

Learn all you need to know about car warranties

See what the benefits of getting a car warranty are. Source: Unsplash.
See what the benefits of getting a car warranty are. Source: Unsplash.

Buying a brand new car for many people is a dream. And also the certainty that you will have a car free of defects, common in used ones, in the first few years. Did you just buy a car and didn’t yet decide whether to buy a car warranty or not?

Well, then you might keep reading as in this article we will answer the question: “Is it worth getting car warranty?”.

When buying a car, the customer expects protection and safety. The warranty provides precisely this: a promise of peace of mind.

The car warranty makes sure you will have the repair done with no costs or your money back in case of some problem.

This protection is worth it, as it guarantees you that your money will not be wasted.

A good car warranty is about $2,550, but it can range from $1,000 to $4,500.

One thing no one wants when buying a product, especially a car, is for it to go into trouble. But it is important to know that you have options in case of situations like this. And that is why today we are going to clarify the main doubts about car Warranties related to defects or problems in vehicles.

Logo XRP crypto

XRP crypto: how it works? Get Started With XRP

The universe of digital currencies might be challenging to understand. So, today, we will present the XRP crypto, how it works, and more.

Advertisement

Save money by getting a car warranty that covers everything

Trust is the basis of any negotiation. When buying or selling a car, this trust is expressed through the warranty. The main objective is to minimize the possible financial costs in the event of an unexpected failure in the vehicle. And safeguard the consumer.

When choosing a car warranty, you should choose one that covers everything, because we can’t prevent what might happen.

Generally, the difference is not a tremendous amount of money to choose a warranty covering every situation.

So, keep that in mind.

What is a car warranty?

Everything you need to know about car warranty. Source: Pexels.
Everything you need to know about car warranty. Source: Pexels.

The car needs protection and, therefore, buying a warranty provides peace of mind to the customer. Having a mechanical problem with the car you just bought is a setback to which, unfortunately, everyone is subject. 

But, to give a minimum of peace of mind to the consumer, there is a warranty, which covers all products sold on the market – including, of course, cars. Mechanical problems can appear quite frequently. And having this card in hand can be very helpful to reduce possible mishaps. After all, the vehicle is insured.

The car warranty facilitates repairing or exchanging a product with factory defects, at no cost to the consumer. Therefore, it represents a great advantage for those who purchase a transport, avoiding major headaches.

A car warranty is a contract that has as the main goal to minimize financial loss in case of some unexpected damage to the vehicle. The warranty is a device that, in general terms, orders the repair or replacement of the product with factory defects, at no cost to the consumer.

When you buy a car warranty, you can have peace of mind that you can get insurance if something happens.

If your car is damaged, the car’s manufacturer or the aftermarket warranty company will pay for the repairs needed. 

How long is a car covered under warranty?

Usually, a car warranty period is set by a period of time, or, in other cases, by a number of miles run by the vehicle.

Typically, the contracts are set with a period of 3-years, or, when set in miles, 36,000 miles.

But it will depend on the contract offered by the warranty company.

What is a good price for an extended car warranty?

The extended warranty is a type for a warranty that has no relation with the manufacturer or the importer but is an insurance offered by a third company. The consumer pays to have the warranty benefits for a more extended period of time.

In this modality, there are still three types: the original, which maintains exactly the same coverage as the original factory warranty; the enlarged original, which offers extra benefits over the original; and the differentiated one, which has a smaller coverage than the original.

It will depend on the car and its price because the warranty price is calculated depending on that.

Generally speaking, a good car warranty is about $2,550, but it can range from $1,000 to $4,500.

After all, is it worth getting a car warranty?

Have your rights guaranteed in case of vehicle problems. Source: Pexels.
Have your rights guaranteed in case of vehicle problems. Source: Pexels.

It is worth getting a car warranty as it will make sure that you and your money will be protected in case of some damage in the car.

A car is not cheap, so it is worth being more careful and investing a little more in safety.

Also, a car warranty will ensure you will not have to pay for expensive repairs that would cost a lot more than the warranty itself.

The warranty sets several benefits to customers and selling car companies. Customers are assured that they will be safe in case of problems in the car that may happen in the future, minimizing the need to spend money on extra services.

However, it is not just the consumer who benefits; the selling car companies also benefit. After all, they manage to optimize sales, providing more security to the consumer and reducing post-sales expenses.

Pros

  • You will save a lot of money by not paying for expensive repairs
  • Feeling of peace of mind because of the extra protection
  • You will not feel pressured to sell your vehicle, therefore, you will drive it for longer
  • Value your vehicle at resale
  • No losses after the purchase of a used or new vehicle

Cons

  • Some warranty companies set a certain period of time for the warranty to kick in.

Now that you know all about car warranties, you can decide the best option for you!

And if you’re looking for a way to improve your credit score, check out our article below!

Pessoa segurando celular com aplicativo Experian

How to improve credit scores with Experian BOOST?

Raise your credit score using Experian BOOST™ Credit Score and Monitoring! Keep reading to learn how to apply for it.

About the author

Aline Augusto

My name is Aline Mesquita; I'm a writer here on the blog, where I write about finance in general and other subjects. I have been working with content creation for ten years. Also, I'm post-graduated in Project Management, with expertise in SEO practices. Currently, I am studying finance, market trends, and cryptocurrencies.

Reviewed by

Aline Barbosa

Senior Editor

Trending Topics

content

First Phase Visa® Card review: improve your score!

If you're looking for a credit-building card and have a low score, you can read our First Phase Visa® Card review to learn about this card!

Keep Reading
content

What is a crypto OTC trading market?

If you are into crypto, I imagine you have already asked yourself the question: what is crypto OTC market? We’ll explain it all to you here!

Keep Reading
content

SoFi Active Investing vs Fidelity investing: Which is the best to invest in?

Do you need a good online broker to help you invest better? Read more to know which one is best: SoFi Active Investing or Fidelity investing!

Keep Reading

You may also like

content

Investing for students: how to get started today!

This guide will help you start investing today if you're a student. Learn six steps to learn about investing for students and start your investment journey!

Keep Reading
content

All you need to know about Capital One SavorOne Cash Rewards Credit Card

The Capital One SavorOne Cash Rewards Credit Card offers unlimited cash back, bonuses, and more. Check out the full review!

Keep Reading
content

Neo Financial credit card review: a better way to manage your expenses

Canadians deserve a better way to manage credit. That's why Neo Financial credit card put the work to make it the best cash back credit card ever. Read the review to find out why and how they do this.

Keep Reading