Used Car Warranties

About Used Car Warranties

Every new car comes with a new car warranty, but used cars are a different story. Some come with warranties and some don’t. It often depends how old they are and who you buy them from. For example, some used cars may still have a manufacturer’s warranty in effect. Others may be sold “as is” and have no warranty whatsoever.

When shopping for a used car, you will need to determine just how important used car warranties are to you. You may feel like you need coverage, or you may feel like taking a gamble. Whatever you decide to do, it is a good idea to educate yourself about these warranties prior to making any decisions.

Types of Used Car Warranties

Used car warranties are not always available. The availability of a warranty often depends on the year, make, and model of the car, as well as the dealer you are buying the vehicle from. This can be quite confusing when you are shopping for an auto.

So consumers know exactly what type of warranty comes with the vehicle they are purchasing, the Federal Trade Commission requires car dealers to post a document in the window of the vehicle. This document is known as a Buyer’s Guide sticker. The Buyer’s Guide sticker tells you exactly what types of used car warranties (if any) are available with the used car.

Here are the most common types of warranties for used cars:

• Manufacturer’s Warranty. A manufacturer’s warranty may still be in effect on the used vehicle that you are purchasing. This type of warranty often provides bumper-to-bumper and powertrain protection.
• Implied Warranties. In almost all U.S. states, used cars are covered by implied warranties under state law. There are two basic types of implied warranties. The first is a “warranty of fitness for a particular purpose”. This warranty applies only when you are buying the vehicle for a specific purpose. For example, if the dealer says the used car will haul a boat, then the car must have that capability. The other type of auto warranty, a “warranty of mechantability”, is a promise from the dealer to you that the vehicle will run. By law, implied warranties require an auto dealer to stand behind their product.
• As Is / No Warranty. When you buy a used vehicle “as is”, there is no warranty. If the vehicle breaks down, you are responsible for all repairs.

Buying a Warranty

Your coverage is only as good as the warranty that you purchase. If you decide to purchase a warranty, make sure that you take time to research and evaluate all of your options. Used car warranties are often very different from one another. Coverage and costs will vary. By taking time to shop around, you can ensure you get the best deal possible.

Here are some tips that you can employ when shopping for warranties:

• Compare cost and coverage. Expensive warranties don’t always provide the best coverage. On the other hand, cheap warranties may not even be worth buying.
• Look over the warranty carefully. Make sure you understand what is covered and what is not.
• If possible, get a low or $0 deductible on repairs and maintenance.
• Talk to your local repair facility to make sure they accept the warranties that you are considering. .
• Make sure you aren’t getting ripped off—contact the Business Bureau to learn more about the company that is selling the warranty.
• Buy a warranty that backed by an A.M. Best rated "A" or better insurance company.