Should You Buy Extended Warranty On A Car? OR ANY Finance Office Products?

[@tericoulter4426]

I used to sell cars and I also worked in the back office of a car dealership for a while. Extended warranties are a scam. I would see the same warranty at all different prices (hundreds of dollars of difference for the same warranty). They will get whatever they think they can get away with. If you have done your research on a vehicle and feel it is good value then trust your research. Anything that goes wrong will likely be less expensive than the extended warranty was. The other scam back in the day was undercoating. They wanted to ding you extra for that rust protection. Many folks fell for that but vehicles came from the factory already undercoated. If they put too much pressure on you had better be willing to walk away.

[@RamadonPiano]

If you have an expensive german car then I recommend an extended warranty. It is a whole lot cheaper than 5-10k repairs.

[@catpaws8214]

I second this. If you paid a 100k on fully optioned vehicle thats high tech, you need that covered at least for the first 5 years cos tech can go wrong. Won’t recommend it on a honda or toyota.

[@magnoliap5824]

My Toyota dealer tried to sell me one and of course I said no. My car is 5+ years old now with zero issues.

[@damianpasour]

I think it all depends on what kind of car brand that you are buying like if you were buying a jaguar Land Rover product If you wanna get one you definitely need to have a warranty on those cars

[@nofyfb123]

If you were buying a jaguar Land Rover "product", you need your head examined. Same goes for all other cadillacs/fords/fiatchryslers/bmws, etc. With one REAL exception - Toyota.

[@ctclardy]

What a lot of people don't realize is that these extended warranties are negotiable... sometimes as much as $1000 to $1500.... only buy the manufacturer's extended warranty if you do buy one.

[@richscott2483]

Correct, Auto Company such as Toyota/Honda Vehicle Extended Warranty (not 3rd Party) are negotiable and you can call any "Brand such as Toyota/Honda" Dealership in the USA and ask for a Quote. You can save a lot of money. Each dealership finance manager sets up their own plan and it varies much across the U.S. They submit the application to the Auto Company Insurance Dept. and then the Insurance Dept. send you the Coverage Warranty Card with an account number. example Honda Pilot 8 yr/ 80K mile for $2,300 another Honda dealer same car 8 yr /80K for $2,110, and next dealer 7 yr /120K for $1,600 and last another quote 8 yr/120K for $1,900. - choose the best for your needs. Be aware of the mileage limitation and how much you drive per year. You drive a whole lot ... chances are the Extended Warranty does you No Good. Most factory warranties cover basic 3 years and Powertrain 5 years. If only keep the vehicle less than 5 year ,,,you do not need extended warranty. However, if you drive 20K to 25K miles per year, you may exceed the maximum mileage on the extended warranty causing it to be invalid. Let say 10 year/125K miles ... in 5 to 6 years worth of driving the warranty is no good. Myself, I drive roughly 6K miles annually and in 10 years that is 60K. Unfortunately, both Basic and Powertrain OEM Factory Warranties expired before or at 5 years. So if something does occur in 6, 7, 8, 9, or 10th year I am covered and well under the maximum mileage. GAP is rather affordable and cheap if you get a auto loan. I paid off my car in 6 months, then decided to get new car replacement on my auto insurance cost of $32 per year. Does not mean you get a brand new car, so here on my 2023 Camry it is now 2026, what I would be entitled to is a 2022 or 2023 or 2024 vehicle with less than 20,000 odometer miles. Or the used market value of a similar vehicle and given the cash to buy what I want. Not like I would be able to get a brand new 2026 vehicle unless I put the money toward a 2026.

[@speederz1]

read the FINE line people!!! extended warranty is not bad if u do ur homework...DO NOT pay full price.....negotiate the price....and the warranty states that U must have ur oil change at the dealership cause if u dont the warranty will give u a hard time...and of course the dealer wont tell u this....alot of these places dont give a crap about u,all they care is there own pocket...Good Luck

[@ronaldcooper7609]

With Toyota at least, you don't have to buy an extended warranty at the time of sale. You have until the 36,000 included one is about to expire.

[@aalmi002]

Good to know. How much do those Toyota extended warranties usually go for?

[@fremontpathfinder8463]

I decided to take off the gap insurance and the warranty when I refinanced my Honda HRV shortly after buying it. When I refinanced with my credit union my interest dropped to 2.4% and I took off all warranties. This, combined with the low interest rate dropped two years off the payments. So glad I did that. My 2020 HRV has been very reliable. On top of that, I researched the warranty sold to me and it turns out the company tries to pressure car repair shops to use used parts. I this was a 3rd party plan. In two years I plan to get a Toyota 4 runner and I will get an extended warranty even though it is reliable. I also pay more every month on my car than what is owed.

[@nofyfb123]

You don't need an extended warranty for a 4Runner. But if you decide to buy it, get it from Toyota.

[@aalmi002]

I’ve always wondered about this myself especially in light of buying two new vehicles within the last couple of years. I personally think that it was great that I got it for the GMC Terrain we bought in 2021 since that car has already presented problems like the battery needing to be replaced last year and the fuel module for the car having to be replaced just a couple of months ago. Granted, those were still covered under the original manufacturer warranty, but still it might be indicative of future problems with the car. With the Toyota Highlander we felt it wasn’t necessary to buy an extended warranty since Toyota has a good reputation for reliability so I don’t think I would get my money’s worth with an extended warranty especially when there’s already a long warranty with it because it’s a hybrid system. However, I didn’t like that within 6 months we had to replace the purge valve, but I hope that was a fluke and it was a minor replacement anyways.

[@donaldwilson2620]

When it comes to purchasing vehicles, I first thing I do is do my research to make sure the vehicle I'm considering is a good choice, especially when it comes to reliability, cost of maintenance, and resale value. Second, once I decide, I always make a large down payment so I could keep my monthly payments low and try to pay it off early. I was considering an extended warranty, but because I'm a technician for a Honda dealership, I decided against it because could do my own repairs, and I know what to look for if my 2020 Honda CR-V needs unexpected repairs down the line.

[@carlovanrijk4039]

DonaldWilson, that is a smart way to go about it. I work at Honda Manufacturing, so I have access to repair techs who can share invaluable information about maintenance and replacement. But most people don’t have that access, so a warranty may be the way to go for them. 🤷🏻‍♂️

[@808saimin]

Since you're a Honda technician, I've read somewhere that Honda sensing isn't covered by warranty. Is this true?

[@donaldwilson2620]

@808saimin Honda Sensing is considered electrical, and it should be covered under the factory warranty, which is 3 years/36,000 miles, or if you purchased an extended warranty, it should be covered as well, depending what that extended warranty covers because each warranty is different. But, if the vehicle was involved in an accident or if rodents chewed the wiring, then you may have to call your insurance company because Honda won't cover the vehicle in those circumstances, unless the dealership will do a goodwill claim.

[@808saimin]

@Donald Wilson Thanks for the reply! Have a good one and stay safe.

[@romdatt]

Good points regarding the warranty. Having worked in both corporate and dealerships, I can say as a statistical fact that extended warranty owners do indeed win when they keep their cars for beyond the manufacturer warranty - even with the 'reliable' brands. I would add that we always review the inclusions and exclusions. For example, Honda's manufacturer powertrain warranty does not cover turbo chargers, they are only covered in the comprehensive coverage. Same with the water pump. Additionally, wear and tear items like suspension components (esp for heavier users/drivers) are typically covered under the comprehensive. Items like the extended warranty will cover those items throughout the course of your ownership - which have saved thousands for customers.

[@jerrylundegaard2592]

An extended service contract (if you work for a dealership you know only the manufacturer issues a warranty with the sale of a new vehicle) is never a wise move. All ESCs are written in a manner to avoid payouts. That is the only way a provider of ESCs can remain in business. They cannot payout more than they take in. The smart move for any new car buyer is to take the money they would pay for an ESC and place it in a high interest on-line savings account. Most ESCs will cost at least $2,400, often much more. Putting that $2,400 in a high interest savings account will result in a balance of $2,700 after three years (actual warranty period for most vehicles) and $2,800 after four years. Doing this ensures the customer has the money should a repair be needed or has the money should no repair be needed. The key is the customer has the money other than that smarmy F&I manager the customer spend a wonderful hour or so with years earlier. Furthermore, having the money readily available eliminates the, more likely than not, issue with the ESC provider not covering the actual repair. The simple reality is the majority of ESCs do not pay more than they cost. It is simply math. The provider of the ESC has experts to determine the likely payout. The provider then sells the ESC to the dealer at a profit. The dealer then sells the ESC to the customer, again at a profit. In the end the customer pays many times the amount the experts know will be paid out. ESCs are a bet and as wit all bets the odds are heavily in favor of the house. If a car buyer believes he or she needs an ESC, the only ESC to buy is one backed by the manufacturer. All third party ESCs are best ignored.

[@susanmeredith4957]

I did buy the Toyota extended warranty. Did negotiate a lower price. I wish Canada could get some of the higher warranty discounts that US seems to be able to get.

[@ilovetotri23]

Great video thanks! I had never heard of gap insurance until my second to last car purchase. It was buying a 2014 Toyota Tundra. I put down $8000. I was shocked that they would think I thought gap insurance made no sense, they are pros at selling that stuff. Anyways, I turned it down. I paid off the loan about 6 months later. I definitely think there is a place for gap insurance. If you are buying a quality vehicle, regardless of mileage, extended warranties are a waste of money.

[@richscott2483]

Hi! You have the new vehicle basic bumper to bumper usually 3 or 5 years and powertrain for 5 years which are auto manufacturer (Mazda, Honda, Toyota, Ford, etc.) warranties. Therefore, you do Not need any Extended Warranty unless you intend or plan to keep the vehicle longer than 5 years. If you plan on keeping the vehicle longer than 5 years let say 7, 8, 9, and 10 years, you should consider purchasing an Extended Warranty providing you drive less than 10,000 to 12,000 miles per year. Most auto manufacturers only provide an extended warranty from 7, 8, or 10 years with 125,000 miles maximum. If you drive 20K to 25K miles per year and the Extended Warranty is good for 8 years with 125K miles, you essentially going to hit the maximum mileage limit in 5 years which means you should Not get an extended warranty as the first 5 years are covered by the auto company warranty and surpassing the max mileage limit your warranty is no longer valid. Next, having a loan, yes do get GAP insurance, it usually less than $200 and it is worth it. You can be the worlds best driver and never have an accident, guess what? not everyone is the worlds best driver and they are aiming to have a collision course with you. Rustproofing is not required for the first 3 to 5 years, however depending on your geographical location living near the Ocean or in the northern states where roads during winter season get Sodium chloride (salt), magnesium chloride, calcium chloride, calcium magnesium acetate and potassium acetate then have your undercarriage checked and clean every 6 months or at least once a year. Have signs of corrosion, then have it rust proof with KROWN, Corrosion Free, or Rust-Check, or Do-It-Yourself with Fluid Film. Never ever go to Ziebart as they are expensive and the worst at corrosion protection. Dealerships are known for talking you into things you do not need. Watch out for 3rd Party Services as the Dealer is not responsible or guarantee anything for services they do not provide themselves. They get commissions for you paying for a 3rd Party service contract. You have to be smarter than those people at the dealership. They will attempt to sell you the world and guarantee you nothing, they just want all your money. Do not sign anything unless you are willing to pay. Read all, do not rush, that is where dealers get you ... blah..blah...blah... Sign HERE! quick and they got you. Buying a new car is great, only do it on your Terms.

[@thomaswyskowski3780]

"I didn't want the added accessories and I won't pay for it", start walking if you get no compromise, there's another dealer not far away

[@adriannalundasan7570]

The road hazard protection warranty I purchased for $400 for my 2022 Mazda3 was totally worth it. Reason I bought the warranty is because of two things, one is the 18inch rims and 45 sidewall of the tires of the car and second, some roads in GTA are in quite poor conditions. Within 3 weeks of owning the car, I hit a deep pothole at Allen slightly bending the rims and a bubble on the sidewall. I took it to the dealer and they said they're going to replace the tire and fix the rim. That costs $800 dollars and before Chrismas last year I hit a pothole again causing the same damage but the repair cost that time was much higher and over $1200. I would say that the $400 road hazard protection warranty paid off.

[@sneakeraplus]

Thanks, how about tyre and rim protection plans?

[@STRIKER520]

It depends especially on what they cover for the price. I brought my car in when I had one multiple times with transmission issues. Strange they didn't notice until after the warranty. Besides the noise you would notice during left turns it disengaged. Was a internal leak that came out of my pocket on top of paying for the warranty. So the price of the warranty was around the same as replacement of the transmission. My current vehicle is a 2012 RAV4 that came with warranty in 2015 certified used. They pushed for me to get a extended warranty for 2k and got annoyed when I said no. Mostly because they didn't really make any money off me. It didn't sell originally at a dealership farther away so when they brought it to another I checked it out and got it under 17k. He had the sheet showing how much they paid for different cars on the lot and I got it for a few hundred less. They wanted 21k originally but it sat for a bit and unlike now they want the cars off the lot so they can get more.

[@RizHail]

Honda Dilawri dealerships in Canada first make you sign a contract with Un-refundable deposit of $3000+ before even showing you a full quote. Means if you walk away from the final deal they keep the money. Pathetic dealership experience.

[@crecasens]

Waiting until the manufacturers warranty is a bit older before getting the extended warranty is a good idea because when I bought mine, I did not realize that the two warranties run concurrently

[@aalmi002]

That’s very good to know. You would think they run consecutively!

[@tej4016]

wow, I thought it starts after manufacturer's warranty

[@wholeNwon]

ALWAYS be willing and comfortable walking out. It's YOUR money. Personally, I only buy high quality (meaning VERY reliable) makes and models from private sellers after a good PPI by my own tech. I would never set foot in a dealership.

[@boblowney]

re dealer add ons, the Lexus dealership near me, Serramonte Lexus, CA USA forces customers to take its dealer installed options like the useless Permacoat and anti theft tagging. Adds up to a couple thousand at least. It's their way of marking up their inventory without explicitly having to. Dealer Installed Requirements is more accurate.

[@johnscott1873]

I actually live in the Bay area as well and I heard Stevens Creek Lexus is a lot better to buy from no add-ons and they are actually selling at MSRP the GX 550

[@mikemason746]

Just like any kind of insurance, the only way the warranty company can be in business is if they pay out less in claims than they get in premiums. So, on average, extended warranties are losing deals just like betting at the racetrack, unless you are 'lucky' and your car breaks. But for some people that protection from large losses is worth the bet if they cannot handle a big repair cost.

[@richscott2483]

You have the new vehicle basic bumper to bumper usually 3 or 5 years and powertrain for 5 years which are auto manufacturer (Mazda, Honda, Toyota, Ford, etc.) warranties. Therefore, you do Not need any Extended Warranty unless you intend or plan to keep the vehicle longer than 5 years. If you plan on keeping the vehicle longer than 5 years let say 7, 8, 9, and 10 years, you should consider purchasing an Extended Warranty providing you drive less than 10,000 to 12,000 miles per year. Most auto manufacturers only provide an extended warranty from 7, 8, or 10 years with 125,000 miles maximum. If you drive 20K to 25K miles per year and the Extended Warranty is good for 8 years with 125K miles, you essentially going to hit the maximum mileage limit in 5 years which means you should Not get an extended warranty as the first 5 years are covered by the auto company warranty and surpassing the max mileage limit your warranty is no longer valid. Next, having a loan, yes do get GAP insurance, it usually less than $200 and it is worth it. You can be the worlds best driver and never have an accident, guess what? not everyone is the worlds best driver and they are aiming to have a collision course with you. Rustproofing is not required for the first 3 to 5 years, however depending on your geographical location living near the Ocean or in the northern states where roads during winter season get Sodium chloride (salt), magnesium chloride, calcium chloride, calcium magnesium acetate and potassium acetate then have your undercarriage checked and clean every 6 months or at least once a year. Have signs of corrosion, then have it rust proof with KROWN, Corrosion Free, or Rust-Check, or Do-It-Yourself with Fluid Film. Never ever go to Ziebart as they are expensive and the worst at corrosion protection. Dealerships are known for talking you into things you do not need. Watch out for 3rd Party Services as the Dealer is not responsible or guarantee anything for services they do not provide themselves. They get commissions for you paying for a 3rd Party service contract. You have to be smarter than those people at the dealership. They will attempt to sell you the world and guarantee you nothing, they just want all your money. Do not sign anything unless you are willing to pay. Read all, do not rush, that is where dealers get you ... blah..blah...blah... Sign HERE! quick and they got you. Buying a new car is great, only do it on your Terms.

[@nore8141]

Just what I needed to hear thank you 🙏

[@sanjaypatelmd4669]

For BMW it works perfect…most BMWs will break down after warranty expires…

[@nestoraranha4067]

I was informed by the dealer if I wanted the car sooner I must buy the extended warranty and rust and paint protection I ordered a new Honda six weeks ago and could get it sooner if I got the extra protection. Else the wait could be a lot longer. Felt I was being held hostage They printed a new bill of sale with all the extras and wanted me to sign it. I said I had to think about it. Supposedly Honda does not like to sell their cars without the extras added in

[@carhelpcorner]

It's not Honda it is the dealer. Unfortunately sometimes you have to shop around quite a bit to find a dealer that doesn't do this.

[@nestoraranha4067]

@@carhelpcorner Thank you. Unfortunately they have my deposit. It has been over six weeks. Hopefully I get the car soon

[@waynepark4430]

Great information

[@detecteurquebecois7302]

Thanks for all your informations to the customers we are. 😊

[@severogutierrez9494]

Very good tips I going to get toyora R4 2024 in the next couple months

[@clutchhammer]

Extremely helpful! Thank you very much!😊

[@johnreese3762]

Great advice/video! Thanks!!

[@CarlosMartinez-mr1qb]

Great Review!!! Thank u

[@carhelpcorner]

Thank you!

[@blackheartsmarine0351]

If only there was a warranty company that actually helped fix things

[@tahsinsous7133]

Very informative one, thank yo

[@robertwhite9898]

Unless it’s a vehicle that’s problematic then it would make sense. Although I wouldn’t buy a vehicle that was problematic in the first place. If you relay on your vehicle get one that’s got a solid reputation & known for reliability. If want to purchase an extended warranty get a manufacturer,s warranty..

[@bruceleeroy8302]

From my experience, paying for maintenance and warranties up front is usually a ripoff. Most new vehicles have warranties up to around 30k. If you don't run into issues by then, you probably won't within the extended warranty period. These dealers are just trying to make money. Imagine having to pay off all those extras just to pay off a vehicle. Just remember, if you have a trade in, never give them the keys and access to it until you are happy with the final contract, and if you don't sign for it, you're not obligated to pay for it.

[@georgesakellarakos7988]

Hello can you please tell me what can be added on for a used car

[@georgesakellarakos7988]

I tried calling you but it wouldn't work

[@repairman99]

The car manufacturer has 36,000 miles and 3 year warranty. I bought an extended warranty once and never used it. It was extremely expensive. I will never buy an extended warranty ever again.

[@bruceleeroy8302]

💯 It's such a rip-off. If there are no major issues in the first 30k miles, there probably won't be in the extended warranty period either. Just save the money and use it in case something breaks.

[@commentsonthetube14]

I donno how this computes widely, but I figure out ought to pay off a loan as quickly as possible if the interest rate is above the market rate you can get for leaving your money invested, or as slowly as possible if your rate is below what you can get for your invested assets. Especially if the loan interest rate is also below the inflation rate, it is wise to pay it off as slowly as possible. That's what I'm doing with my house. I could pay it off but I got it at 2.5% so the government money printing is paying it off for me and I can let that money work for me in the market.

[@bLuDrGn2011]

For me, I bought Toyota VSA for a peace of mind. I'm not worried about mechanical issues as Toyota's are reliable. As someone that works in IT, electronics are another story, they can and will randomly stop working over time.

[@oscarc-a1869]

Please please review Chevy Colorado Z1 or gmc canyon 4

[@Princeabril.]

Got the extended warranty on my x5 and gap….better to be safe then sorry

[@EyeFoodForYou]

Didn’t watch the video but the question that we are trying to find the answer to is: Is it a good idea to bet that an extended warranty client will win against a team of underwriters? A bonus question - what are the chances of winning the lottery?

[@nofyfb123]

A former Mechanical Breakdown Inspector here. No, I did not determine what was covered/paid for, my job of nearly 20 years was to provide TECHNICAL report - cause and extent of damage and recommended repair. I'd worked for virtually every extended warranty company in the country, and here is my advice: NEVER EVER buy a third party contract - they are mostly crooks. Only MANUFACTURER's contract might make sense if - for whatever weird reason - you own a junk vehicle like... virtually every single one except Toyota and - to a much lesser extent - Honda or Subaru. Feel free to ignore.

[@alfredyost7972]

We bought an extended warranty and also service contract too. It probably was not worth the money. Our Ford Explorer has never had any issues. Also we bought our vehicle before COVID hit. What that means is we did not drive very much. So our service contract might expire before we can use all of the services. Of course who could have predicted that COVID would have changed things as much as it did. Thoughts?

[@joelthorne7434]

If paint and rust protection wasn’t applied at the factory, then I don’t need it. Also, ceramic coating needs to be reapplied over time and scratches cannot be buffed out with ceramic coating-The coating needs to be removed and reapplied.

[@NikkoTuason]

Getting a warranty on a 2021 Audi Q3 with about 50,000 km isn't such a bad idea correct?

[@Briansgate]

most helpful

[@anilmehta7821]

Love your episodes, have been trying to see but could not locate any of your reviews on the Mercedes G wagon diesel and petrol versions. Any plans to do one? Or if you could point me in the right direction if done already

[@carhelpcorner]

Thank you! I haven't reviewed a G Wagon yet but I'm working on it 👍

[@stiggsmasta]

Have you explained car lots selling cars that are not certified and have an $800 charge to certify. Can you test drive it, have they fixed or checked for issues for example?

[@carhelpcorner]

This is a red flag of a bad dealer. Usually these cars are perfectly fine and certifiable. The dealer really does this just to advertise a lower price and then hit you with an extra charge.

[@coy9898]

What are the rights in Saskatchewan? Anyone know?

[@carhelpcorner]

In SK, dealerships are regulated directly by the provincial government through the Financial and Consumer Affairs Authority (FCAA) of SK. They have a website that explains your consumer rights.

[@hdanna823]

what about a warranty on a used car? take a chance without one or spend the money?

[@carhelpcorner]

If the original warranty expired then the only option is a third party warranty. You have to be very careful because most of these are not worth buying. You must do research and only buy one if it is from a reputable company with proper coverage and a reasonable price.

[@georgesakellarakos7988]

Can we talk outside of your site please

[@Tyler-b7j6h]

A lot of Third party Warranty companies. Example: Olive, endurance, Car Shield could be good deal depending on make and model of vehicle and they are legit reputable companies. Sometimes they even cover more than a manufacturer warranty. Just something to think about.

[@billyrock8305]

Nope 👎🏼

[@joey86bu1]

IMO if you have to consider an extended warranty then you are buying the wrong car.

[@majood245]

MGs are excellent warranty. 6 years or 200,000 KM. And way more cheaper than Toyota. Toyotas are crap. And very expensive for spare parts