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Do you need an extended warranty?Today I got a pre-recorded telemarketing call warning me that my car's warranty was about to expire and that this was the last chance I would get to extend my warranty. I was tempted to get a human on the phone and explain that my Honda's new-car warranty expired during the Clinton administration. (Instead, I got a human on the phone and asked to be put on their do-not-call list.)

I've never been a fan of extended warranties. It's a gamble: You're betting your the car will break, while the warranty company is betting that it won't -- and they often stack the deck in their favor. I've put together an article to help car buyers determine if an extended warranty is right for them -- and if it is, how to shop for one without getting taken. Check it out. -- Aaron Gold

Photo: George Doyle/Getty Images

Comments
February 25, 2009 at 9:34 am
(1) Brian says:

The call you got is most likely the same scam that has been around Canada for quite some time. Unfortunately, they are calling people’s cell phones and ignoring the notional do not call list. However because the calls are originating outside Canada, they goverment says there is nothing you can do. End result is they take your money and sell you a “warranty” that is no go for anything.

February 25, 2009 at 9:44 am
(2) Brian says:

I forgot to add… One thing you missed in your article… Negotiate the price of the warranty. Just like anything else added on the purchase, warranties are a high mark-up item. Last car we bought, the saleperson started at $1200 for the warranty and we were down to $500 before she started saying things like you can only buy a warranty when you buy the car and you can’t get it later. (Which was slightly true… the warranty she was selling was only available with the purchase)

February 25, 2009 at 12:06 pm
(3) Hawaiian Don says:

If I was out to buy a Chrysler/Dodge or a Pontiac, then an extended warranty would be part of original cost concerns when buying the car. The “incredible” savings on these poorly built/poor selling cars would be offset by the cost of the extended warranty. Of course buying a Honda/Toyota extended warranty would be a waste of money. However, you might want to consider a low mileage Certified Used Car. That will give you an additional 1 year/12k bumper to bumper and the balance of a 7 year/100k powertrain warranty. It adds about $600 dollars to the cost of the car and they really do that 150 point inspection. But before you buy ask the MANAGER to thoroughly explain the certified program. (P.S. Honda is the best with no deductibles)

February 25, 2009 at 2:36 pm
(4) ChrisF says:

I bought a 3rd party extended warranty when I bought my ’98 VW Passat. It definitely got used…paid the full $800 cost of having the low-grade front suspension components replaced when they wore out at 45,000 miles.I didn’t quite recover the full cost of the warranty before I sold the car at 48,000 miles, but I’m sure I would have given VW’s stellar (lack of) reliability.

I replaced the VW with a Pontiac Vibe, and didn’t bother with an extended warranty due to it basically being a Toyota. 5 years later, and it’s had ZERO repairs done to it.

So in summary, if you’re planning on buying a car with a less-than-stellar history of reliability (or a brand where parts are really expensive), think about getting an extended warranty.

February 25, 2009 at 3:27 pm
(5) Billie Joe says:

My 202 KIA Sedona had over 97,000 miles on it when I traded it for my 2006. The only thing that I have done on BOTH (2006 has 27,000) has been to change oil/filters and the headlight bulbs(?) low beam which is my fault because I drove with my headlights ON even during the day. Why? Yrs ago GREYHOUND reduced accidents by having their units drive with headlights ON. Plus when, as a police officer, our Chief has us turn on the headlights when we put on the overheads (then it was only red lights) So…NO I do not go for the extended warranties. (took me a long time to say it..rite “HULA Don!”

February 25, 2009 at 8:31 pm
(6) Mike in Minn says:

When I bought my used 07 Jeep I bought it with an extended warranty because only 35,000 miles of Chrysler’s lifetime warranty is transferrable. Like Don said, I went into it with open eyes knowing that as a first year Chrysler product, the 07 Wrangler is trouble-prone. So I decided to bet against the warranty company. I also decided that I was just putting a dollar value on my peace-of-mind. Well….so far I’ve gotten the peace of mind, but nothing else. It just hasn’t had any troubles or recalls. I have a hard time hoping it’ll break down but I DO indulge the hope that anything that needs to break will do it before the extended warranty expires in 5 years.

February 25, 2009 at 10:18 pm
(7) Mike in Minn says:

Ooops, I meant 36,000 miles.

February 25, 2009 at 11:31 pm
(8) Hawaiian Don says:

Mike, don’t sweat the Wrangler too much. It’s about the only Chryco I trust. I had a 93 hardtop that I took to Ukraine for several years and drove it on frozen roads with horrendous ice holes…it slugged it out without a hitch. When they took over Jeep back in the eighties, they had the presence of mind not to mess with a “legend”. My son has two and they’re flawless. Keep in mind that the Wrangler is designed for extremely heavy duty.

February 27, 2009 at 12:35 pm
(9) Jay says:

I have bought an extended warrantyn on a car that shouldn’t need one. I have a 2003 Honda CRV. I have to say I made out. The warranty cover two of the three major issues with my car. The power locks went haywire and the cataltic converter melted and I had parts swiming thru the cooling system. I has a part that was considered as part of the emmission system that I had to pay. But paid for a $1200 plan and was covered for $1800 worth of work- It’s all a crap shoot.

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