Extended warranties

[wallyuwl]

I had a question about an extended warranty.

We just refinanced our 2010 Equinox from 4.5% to 1.49%. It has 48500 miles. It is worth $18k+ on trade and we oew just under $11k. We will save about $700 on interest by refinancing.

As part of the refinance the credit union had available the "easy street" warranty by Route 66. It seems like they only work with credit unions, and they are out of Arkansas. The warranty has a list of exclusions instead of inclusions (covers everything except exhaust/emissions, spark plugs, oil, tires, brake pads/rotors, belts and hoses). No deductible. They even pay $65 for a battery.

I bought the warranty and added it to the loan. But I have 30 days to cancel it. It cost me $1600 for 100,000 miles and 5 years (whichever comes first). So I'd be covered up to 148,400 miles or July 30, 2017.

I'm not looking for a thread about how great or how bad extended warranties are. But does anyone have any experience with this particular company? Does it seem like a wise investment for the cost and coverage? We will probably keep this for a while and trade in our newly leased Elantra for a larger crossover that can tow at the end of the lease in three years.

Thanks.

 

[demarpaint]

Coming from car sales I usually advise people to stay away from extended warranties, especially from companies like the one you mentioned. I would also look very hard at the small print because many of the warranties out there only cover the vehicle to 100,000 miles, not 100,000 miles plus what is on the clock.

Also there are many places that flat out refuse to do work for a lot of these warranty companies, especially dealerships, unless they sold you the warranty. Opinions vary, and yes there are people who have benefited from extended warranties.

 

[wallyuwl]

Originally Posted By: demarpaint
Coming from car sales I usually advise people to stay away from extended warranties, especially from companies like the one you mentioned. I would also look very hard at the small print because many of the warranties out there only cover the vehicle to 100,000 miles, not 100,000 miles plus what is on the clock.

Also there are many places that flat out refuse to do work for a lot of these warranty companies, especially dealerships, unless they sold you the warranty. Opinions vary, and yes there are people who have benefited from extended warranties.


They have a A- I think from the BBB, but that doesn't always tell the whole story. It is 5/100,000 from the date you buy the warranty, not until the vehicle reaches 100k miles. I will call a few mechanics I know and see if they have anything to say about the company, that is a good idea. I do have 2 years left on the powertrain factory warranty.

 

[hemitom]

I have never had any use for an extended warranty ! On any of the cars and trucks that i have owned would have been a waste. But recently bought a 2006 chrysler 300 that had a extended manufacturers warranty. The gentleman i purchased the car from was sure glad that he had it.
1. Replaced rocker arm shafts both banks.
2. replace steering rack.
3. Some type of a/c work
4. Thermostat.
5. steering links and other bushings etc twice on both side.

He came out ahead on the rocker shafts repair alone.

 

[demarpaint]

Originally Posted By: hemitom
I have never had any use for an extended warranty ! On any of the cars and trucks that i have owned would have been a waste. But recently bought a 2006 chrysler 300 that had a extended manufacturers warranty. The gentleman i purchased the car from was sure glad that he had it.
1. Replaced rocker arm shafts both banks.
2. replace steering rack.
3. Some type of a/c work
4. Thermostat.
5. steering links and other bushings etc twice on both side.

He came out ahead on the rocker shafts repair alone.


Some people do come out ahead, keep in mind a warranty is like an insurance policy. Insurance companies didn't get the wealth they have losing money on policies they sold. I have two shops that I deal with from time to time, and have become friendly with the owners, none of them accept any extended warranties. They tell customers you pay for the repairs and get paid from the warranty people. US Fidel..... comes to mind.

 

[71Chevyguy]

Not really familiar with the company you purchased it from so I cannot comment on that. Worked for a dealer for many years and we did sell an extended warranty. In my experience they really paid out for some things I felt should not even be covered. It may make you feel better to have the protection if you really do plan to hold on to the vehicle for the long term. Those vehicles also have some very expensive parts on them so if you do have issues and they do cover your repairs you should be ahead of the game.

Oh and keep the oil changed in that DI engine if you plan to keep it long.

 

[Pop_Rivit]

Extended warranties are a colossal waste of money.

You'd be far better off taking that $1,600 and putting it into an investment that will earn you a decent interest rate. Should you ever need it, you'll have it available (plus be ahead on the interest). If you never need it, you'll be both principal and interest ahead, and you'll be able to afford a car you can pay cash for, rather than get tethered to payments. Keep that money and let it grow as your "vehicle repair fund" should you ever need it in the future. Otherwise, just continue to let it grow.

With all the vehicles I've owned I don't believe I've ever had $1,600 in total repairs over the life of the vehicle (not including normal maintenance items).

 

[rjundi]

If it is not backed by the car maker not even worth considering. These third party companies could absolutely care less about paying out or satisfying a customer. They got your money. Many have a nasty habit of going out of business or making it so painful to collect your mechanic or you give up on it.

I wonder if Arkansas has some lax insurance laws.

 

[demarpaint]

Originally Posted By: rjundi
If it is not backed by the car maker not even worth considering.


Bingo

 

[VicVinegar]

I don't know, I'd be wary unless it was manufacturer backed or sold through a company you know stands behind their products. Costco and USAA both offer extended warranties, and I'd probably be more apt to buy that product than any other third-party warranty. I'd be very surprised if USAA or Costco would direct you to a ripoff warranty.

 

[JHZR2]

Originally Posted By: Pop_Rivit
With all the vehicles I've owned I don't believe I've ever had $1,600 in total repairs over the life of the vehicle (not including normal maintenance items).


If youre not keeping your car long enough to hit $1600 in repairs, then youre getting beat up on depreceiation on a perfectly good vehicle. Just burning dollars another way...

 

[Pop_Rivit]

Originally Posted By: JHZR2
Originally Posted By: Pop_Rivit
With all the vehicles I've owned I don't believe I've ever had $1,600 in total repairs over the life of the vehicle (not including normal maintenance items).


If youre not keeping your car long enough to hit $1600 in repairs, then youre getting beat up on depreceiation on a perfectly good vehicle. Just burning dollars another way...


That's one of the most utterly ludicrous statements I've ever heard. I've had a number of 200,000 mile plus vehicles, and when sold the biggest issue was rust or a safety issue that exceeded the value of the vehicle to fix.

Keep in mind I do nearly all my own work, and my comment specifically excluded "maintenance items" (otherwise known as normal wear items). Few extended warranties will cover these items anyway so they are a moot point in this conversation.

 

[supton]

I was going to say, that's a pretty low repair target. I allot something like $1k/year for anything over 3 years old (which is like 75-100kmiles for me). But I drive a VW, its repairs are getting pricey... And with no garage I don't do any work anymore on my vehicle. Too much of a risk.

But our Civic was almost as bad. Odd, my VW didn't need the extended warrenty (105k before first repair), but our Civic might have broken even on it!

I'm hoping next vehicle I buy I will buy outright, and used, and avoid feeling like I need a warrenty. As long as I can get this VW to go another 2-3 years...

 

[SteveSRT8]

Originally Posted By: demarpaint
Coming from car sales I usually advise people to stay away from extended warranties, especially from companies like the one you mentioned. I would also look very hard at the small print because many of the warranties out there only cover the vehicle to 100,000 miles, not 100,000 miles plus what is on the clock.

Also there are many places that flat out refuse to do work for a lot of these warranty companies, especially dealerships, unless they sold you the warranty. Opinions vary, and yes there are people who have benefited from extended warranties.


All true. Add to this that most consumer rags say they are a bad deal. Read the fine print, they exclude a LOT.

 

[wallyuwl]

I am going to cancel the warranty. It has already gone through, so I can't cancel it through the credit union and have to do it through the warranty company. They will refund the credit union and it will be essentially paying down the principal on the loan. So it is pretty much like it never happened.

I decided to do this because I called the company and it is in fact a 100k mile on the odomoter warranty. And they don't fix things unless they break. So if a wheel bearing needs replacing, they won't cover it unless it breaks, which is a major safety issue. They also are very strict on maintenance records, and if you do your own you need receipts. So even for oil changes I'd need receipts for the oil, which I bought a stash of two years ago and thus of course don't have the receipts for. So if I were to have an engine problem, they wouldn't cover it because I don't have receipts for buying the oil.

 

[chiks]

Originally Posted By: rjundi
If it is not backed by the car maker not even worth considering.


I just read about a person who got screwed by the Lexus CPO wty.
The water pump failed which in turn siezed and destroyed the complete engine. Lexus (ExtraCare) denied wty stating that water pump was leaking and owner should have caught it and prevented the failure. Amazing.

 

[hattaresguy]

Cancel it.

My view on warranties is this, if its such a POS why have it? Pay for the odd repair out of pocket and forget about it.

A warranty is a bet, your betting that your car is a POS, the warranty company is betting it isn't. You have guesswork on your side, they have teams of actuaries.

 

[kb01]

I've never heard anything good about aftermarket warranties. I think the only exception is when you can get a free one from the manufacturer thrown in to sweeten the deal on a new car.

In general, insurance for non-catastrophic events is virtually always a poor value, unless a 3rd party is subsidizing it in some way.

 

[Eddie]

Tempting only if you participate at the local drag strip.

 

[bigmike]

Well, for those who never heard anything good about extended warranties, it's obvious you never heard my story. I'm shocked my extended warranty didn't find a way out after them paying out closer to 5-6k for all the repair work on my truck. They actually did a great job and never gave me grief. It really depends on the warranty company and I believe alot has to do with how the service advisor pitches the deal to them. It helps if he knows what he's talking about and has a working relationship with the warranty company.