Some of the pros of getting an extended warranty on an auto are that they often cover the repair of expensive technology and buyers are able to tailor the plan to their needs, states Christian Brothers Automotive. Negatives include the fact that an extended warranty is expensive and often doesn't cover all repairs.Continue Reading
An advantage of an extended warranty purchased from a dealer and backed by the car manufacturer is that the dealer does all the paperwork and takes care of payments for repair and service, explains J.D. Power. Dealer-backed warranties are also flexible, in that they usually allow the buyer to get repair services from other dealers of the same car brand anywhere in the United States. If the warranty is transferable, the car owner has a better bargaining power during resale, explains Automotive.com.
One major disadvantage to buying an extended warranty is that the cost of the warranty is wasted if the buyer doesn't need to make covered repairs during the warranty period, states Automotive.com. Additionally, many third-party warranties require that buyers obtain service at designated facilities, which aren't always available when the car breaks down. In the event the buyer can't return the car to a designated facility, he is responsible for the cost of the repair, J.D. Powers explains.Learn more about Buying & Selling