Do you have a vehicle that is nearing the end of its factory auto warranty? If so, you may find yourself worrying about the threat of future repair costs. Luckily for you, you have options!
Auto manufacturers are known for giving you a factory warranty that ends right before the car typically starts to break down. When that happens, you are left with footing the repair bill. This leaves many drivers worried about their car breaking down once the factory warranty expires.
That’s why it is important to make the decision between getting an extended auto warranty and a vehicle service contract. Here’s what you need to know:
What is an Extended Auto Warranty?
Auto warranties come from the vehicle manufacturer and can mean several different things depending on the company. Typically, extended auto warranties range from three to 5 years and limit the amount of mileage from 60k to 100k. Dealerships will often sell the warranty as “bumper to bumper” coverage but also could offer less coverage that focuses on certain powertrain components.
Auto warranties are rarely given to vehicles outside of the factory warranty. Review the paperwork on your vehicle to see if you have an extended auto warranty and what type of coverage it is.
Keep in mind that many after-market modifications can void a warranty.
What is a Vehicle Service Contract?
Extended auto warranties are very similar to Vehicle Service Contracts. Although many people confuse the two, there are a few differences. A Vehicle Service Contract is purchased from a third party dealership and is not provided by the manufacturer. They often last for three to seven years, which is usually longer than extended auto warranties. There are various mileage plans covering up to 200k.
What are the differences between the two contracts?
Typically, older vehicles are offered less coverage through a Vehicle Service Contract while extended auto warranties often won’t even offer any coverage for vehicles outside of the factory warranty. The cost of both plans varies based on the vehicle, type of coverage, and coverage length. Extended warranties are usually only used at the dealership from the same manufacturer while a Vehicle Service Contract generally can be used at any dealership or repair facility.
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