Dealership Warranties

[Craigums]

Ok guys, Im buying a used 2004 F-150 tomorrow morning with 113,000 miles on it. The dealership is offering a 2yr or 24k mile warrenty of the drive train for $1,490. Are these warrenties worth it in your opinion?

[Dozer]

That seems like alot of $! I wouldn't buy it.

[jeffreyd]

do some research online for aftermarket warranties. I bought an extend on my 04 when i bought is new, used it many times, it paid for itself several times over the life of the extension. took the original warranty from 3/36000 to 5/100000

[fishing tech]

If a headgasket leaks you are looking at $3-4000. Tcase shift motor is about $350 parts only. If it has a limited slip rear end and the clutches haven't been replaced, well you see where I am going.

[Jeremy airjer W]

Read the fine print and understand what the extended warranty covers. Many people are caught off guard when they find out the things that are broke aren't covered!

There nothing more than piece of mind. With good extended warranty coverage you kknow you'll have little out of pocket expense for the next 2 years.

[Ufatz]

Really take your time here my friend. First question you ask is: "WHO is making this warranty, the local dealership or are you handing it off to FastBuck Warranty of New Jersey???" Third party warranties are notoriously bad deals, filled with ambiguous language and lots of non-covered items.

Secondly, that seems sorta HIGH priced. It could be they are getting that price from you and then paying FastBuck Warranry $1000 and keeping the rest. See what I mean.

Be persistent. Is it the Ford dealership making the warranty? Are you a past customer of this dealership? If not do some serious research.

[Scott K]

A couple things to check out first, read the fine print! Check to see if anyone can do the work, or just this dealer, is there a maximum amount they cover? Do they use new, reman, or used parts? How much is the deductible? Does it cover a rental car?

Car dealers make a lot of money on these, and you can usually talk them down some.

[BobT]

I always figure that they sell these extended warranties because they make money selling them. In other words, the odds are greater that you'll never recoup the cost of the warranty through repairs than the other way around. It's insurance and it really has everything to do with how much risk you are willing to accept and how much you feel you need protection against the potential loss. Our opinion really doesn't apply.

[fishing tech]

I know the Ford ESP waranty is a good one. Some give you money back if it is not used. I have put the ESP plans on my vehicles even though I am a ford tech of coarse I pay %50-100 over cost. Powertrain warranty cost is about $8-900 I think.

[Whoaru99]

One thing is for sure, they're a great deal if you're one of the percentage of people that have a covered failure. However, most people don't ever collect the full value of the policy. If most people that bought the policy were getting a substantial payout the price would be even higher or they wouldn't be offering the policy. They're not selling a money-losing plan.

It's basically the same as an insurance policy. Many people pay to support the claims of the few, the company pockets the difference. Maybe you'll be one of the few but the odds are you won't.

If there is a known dirty laundry list you're seeking protection from, perhaps a wiser investment is a vehicle with a shorter dirty laundry list??

[OnAFly]

The reason they offer them is because you pay more on average for them than they pay out.

Look at how much you are paying for it in the long run (over the life of the loan). Compare that to repair costs for things that are fairly common fixes during the warranties life span. A lot of the time they'll say it's only $1500, but over the loan that could turn into $2500.

Keep in mind what they cover and how they cover it. They don't cover everything and will do everything in their power to get out of holding up their end of the deal if anything does go wrong.

[BobT]

Buying extended warranty coverage is insurance and just like any other insurance such as a home-owner's policy, one must consider the potential loss and decide how much risk he/she is willing to accept.

My home-owner's policy has a rather high deductible. This is because when I consider purchasing insurance I am more concerned about protecting myself from catastrophic loss. I can absorb a $5,000.00 loss. Will it hurt a little? Certainly but I'll get through it. On the other hand I don't think I could afford to lose my entire home. I'm not interested in covering every little mishap. I can afford to replace my kitchen floor if it gets damaged therefore, I carry a higher deductible that I feel I can afford and I keep my premiums down but I believe I am protected from a loss that would break my bank account.

I view extended warranties the same way and so far have never found a policy that I felt was worth the money. But that's just me.

[DTro]

I feel the same way as Bob, and since you are considering buying it, why don't you take the money and instead put it into a "truck fixing account". If you need to use it great it's there, if not, even better, plus it will still be there after the warranty would have expired.

Of course it won't pay for a new engine, but you are playing the odds on that one, and they are probably in your favor for a castotrophic engine or drivetrain failure within that time frame.

[jeffreyd]

Clarification: my warranty was factory dodge extended warranty, not a third party program. a truck fixing acct would be great until you need some extra cash and then why would that acct lets say if you have not touched it in 4 yrs you think ah i have not used it this long ill start dipping into it. then guess what then the truck fixing acct is gone and you are trying to find money to fix something that you could have paid for years ago. I can say that my extended warranty paid for itself. i had a 25 dollar deductible each time i took it in. I can tell you that having the carpet replaced, the door seals, all the pulleys, water pump, alt, ac work, and other things repaired cost me 2300 bucks up front and 225 dollars total for all the repairs I had done. No one can tell me that the work that I have had completed would have been done for less than 2500 bucks, plus had a rental vehicle on the ext warranty each time. you are going to have to work pretty hard to change my mind.

[DTro]

I can tell you that having the carpet replaced, the door seals, all the pulleys, water pump, alt, ac work, and other things repaired

Might I suggest a Toyota next time

[pulleye16]

I would say NO! They'll ALWAYS find a way to say it was something else that caused "the problem." Alot of them have requirements that most be done and documented for the warrenty to even be valid. Like others have said....READ THE FINE PRINT!

Have a mechanic friend look it over. If it checks out ok, don't bet $1500 on it that it WILL break!

[MNice]

carpet, warranty?? Please tell how

[Jeremy airjer W]

Might I suggest a Toyota next time

[Whoaru99]

Clarification: my warranty was factory dodge extended warranty, not a third party program. a truck fixing acct would be great until you need some extra cash and then why would that acct lets say if you have not touched it in 4 yrs you think ah i have not used it this long ill start dipping into it. then guess what then the truck fixing acct is gone and you are trying to find money to fix something that you could have paid for years ago. I can say that my extended warranty paid for itself. i had a 25 dollar deductible each time i took it in. I can tell you that having the carpet replaced, the door seals, all the pulleys, water pump, alt, ac work, and other things repaired cost me 2300 bucks up front and 225 dollars total for all the repairs I had done. No one can tell me that the work that I have had completed would have been done for less than 2500 bucks, plus had a rental vehicle on the ext warranty each time. you are going to have to work pretty hard to change my mind.

I don't think anyone doubts it worked for you but you are the minority in this regard. Most people don't collect big just like most people don't win the big lottery.

[SkunkedAgain]

I'd see how far you can negotiate down the cost of that warranty. Be ready to walk and find another deal. Remember, they want your money and no matter how good they say that his deal is for you (and that others are interested), it's your money that they want. Tell him that you'll pay $750 tops for a 2 year warranty on a six year old vehicle. See what they do. It doesn't hurt to say no, but it hurts to pay that much money if you don't have to.

[solbes]

It's not as clear when you are buying a used vehicle. Who really is providing the warranty: Dealer, Ford, or 3rd party?

When I bought my '02 Dodge truck new I paid $800 to extend the full warranty from 36k to 100k (powertrain was already to 100k). It's amazing how little the normal powertrain covers (basically anything that's lubricated in the engine is how it was explained to me). So for me I had the following items replaced between 36k and 100k with a small deductable: blinker control module, idle air controller motor, rear diffy pinion seal, power window switch, power window motor, and HVAC fan motor. I saved quite a bit of money. Granted 64,000 miles is a lot longer period than the 24k they are quoting you, but then again with the higher mileage more things tend to wear out. I think if you could get the cost down some, say under $1k, it might be a good deal.

[jeffreyd]

you might just look at ford for an extended factory warranty program that you can purchase online. I did this with my magnum. I just did a quick search for ford extended warranty, went to the official ford HSOforum for ext warranty did the quick info for what you listed in the original post. you can get a warranty that will extend be a "ford" warranty for 2 yrs up to 137k miles.

[Scott K]

As far as do you need it? I always look at it this way, if a tranny went bad, you are looking at upwards of $2500, or if an engine went bad, $3500+. Now neither of these are common issues, but they do happen. Will you be able to afford $2500-$3500 out of pocket, without any notice? If so, dont buy the extended warranty, odds will be against you of breaking even. If you cant afford to drop that much cash, then you have to think how valuable it will be for paying $30 a month for the life of your loan, for the comfort of getting a big job fixed, without much out of pocket.

[muddpuppy]

Nope don't do it! Waste of money...Simply don't buy if you think there are problems to be had.

[Shack]

Personally if I was to buy one, it would most likely be a factory extended warranty. One that is upheld by the manufacture of the vehicle you purchased new or used. Even bought used elsewhere or private party, stop by your local dealer (better yet shop around dealers) and see what they have going. Only reason I say this, you'll be paying a little more than after-market, but the dealership service department has some control in the final outcome of the repair authorization. After market! The dealer service department has no control. It is up to the warranty company and the third party adjuster.

After market, the "good" ones that I recall were Wester Diversified, AIG, and a couple others I will check on. When you start getting way off the path, like Justice Brothers or something, I have seen customers burned with legit repairs.

Biggest things to make sure are:

*Deductible!!!!!!

*Rental coverage (allowance per day and amount per repair hours)

*Used, reman or new parts to be installed

* Authorized repair facilities (you can pay out of pocket for diagnoses and towing if not an authorized repair facility)

* Authorized repair reimbursement limit (The warranty company can bail after $2000.00 and make you pay the rest).

*Contact payable amount limit. (Is their a point where the will stop paying any claim? There always is, just make sure it is not 2 or 3 grand).

*Major Deal: How they pay the authorized claim. Either via a credit with the service department or credit card number over the phone. The biggest bummer for the customer is the customer having to pay upfront and then be reimbursed via a check in the mail. This obligation does not include the service center or even the service center or dealer who sold you the contract. Once you sign, it becomes your deal.

An insiders HSO "top" secrete for you guys!

I have only worked for Chrysler & Ford dealers, but there is a little un-known (was, I should say) that the factory would cover 1 to 2 authorized "major" repairs till 7 years or 75,000 miles. This includes 3/36 factory warranty vehicles. They might even now cover up to 100,000. These are called warranty adjustment programs. Customer satisfaction programs for original new car buyers. Do not bank on it, but when submitted, I have seen second owners who purchased their vehicle from a dealership get covered. We are talking mainly drive-train only, unless a major A/C or other repairs under $1000 are a major concern with th model. The dealership has to submit this, with their findings, so be Nice. Yet stress the issue. This is subject to change from dealer to dealer and should not be banked on though. It will include a deducible also, from $100-$500 depending on repair costs.

IMO anyone owning a vehicle, that is not a self mechanic now-a-days, that is going over the 75,000 or 7 year mark is a fool not to buy an extended warranty. I have seen people who have purchased full coverage (read the fine print of "full coverage" ) contracts for under $2000 and have had between $7000-&10,000 in claims paid. If buying new, with todays prices for repairs, how are you going to know of issues to be found next year or the year after? I lived it, it does happen. If you can honestly say "do not buy it then", then give me some numbers. I want to play the Power Ball tomorrow night.

Buying new and trading in before 60,000, I would personally pass on any extended warranty, but the minute you say that, you learn to regret saying it. There cars and trucks folks! They have been breaking down since the first one was made. Although getting better all the time, but I do not see the automotive repair centers and service departments shutting down in any type of mass exodus, anytime soon.

One last Major note: No matter what the salesman says, extended warranty claim are never put in the sole position of the service center or dealer for authorization!!!!!!!! There is no guarantee of any coverage until after a diagnoses, an evaluation and an authorization number/code is granted. Factory Warranty is another story, even extended under $2000.