Car Warranty FAQs
Interested in obtaining a warranty for your new car? Browse through some frequently asked questions to find answers that may help guide you to the best deal for your car.
Types of Warranties
What is a manufacturer's warranty?
A manufacturer's warranty, sometimes called a bumper-to-bumper warranty, is the vehicle coverage included in the original purchase of a new car or truck. Unlike an extended warranty, there is no additional cost to buyers.
Manufacturer's warranties will cover most repairs to your vehicle for a limited number of miles or years (whichever comes first). An example of a typical manufacturer's warranty would be Chevrolets' basic 3 years or 36,000 miles.
What is an extended warranty?
An extended warranty is a service contract that provides additional vehicle coverage to help offset repair costs after the manufacturer's warranty has expired. These warranties are purchased separately, though you may opt to finance an extended warranty and add the cost to the sale price of the vehicle.
Extended warranties can be purchased at any time, but the cost will rise substantially if you wait until after the manufacturer's warranty has expired. To get the best rate, it is recommended that you purchase an extended warranty at the time of sale or before the manufacturer's warranty expiration date.
Are there different types of extended warranties?
When purchasing an extended warranty, you'll have two different options to choose from:
- Dealership extended warranty.
- Third-party extended warranty.
A dealership extended warranty is generally sold by the dealership at the time of sale and is added to the overall purchase price. These warranties are often backed by the automaker, but not always. Specific requirements as to where your car can be serviced for repairs and what components are covered are specified in the extended warranty contract and vary according to the dealership.
A third-party warranty, or aftermarket warranty, is backed by an independent provider such as an insurance company and has no direct relationship with the automaker. These warranties often provide a wider range of coverage options and prices than extended warranties offered through a dealership.
Are all third-party warranties the same?
Coverage options for third-party warranties can vary depending on the provider and the level of protection you choose. Most extended warranties will provide a basic option that includes repairs to major engine components and a high-level protection package that's similar to a bumper-to-bumper manufacturer's warranty—with several other options in between.
Make sure you read the service contract completely before you decide on a third-party warranty to determine exactly what parts and repairs will be covered. If you are unsure if the warranty is backed by a reputable provider, check with the Better Business Bureau (BBB) for a list of accredited dealers.
Do I need to purchase an extended warranty?
- If you're buying a new car that has something like a 10-year, 100,000-mile manufacturer's warranty, you may not need to purchase additional coverage.
- If you're purchasing a used car that's only covered under the manufacturer for a period of, say, 6 months or so, additional coverage can help to offset repair costs down the road.
Before you decide to purchase an extended warranty or not, take these factors into consideration:
- Does the car have a prior history of repairs?
- Purchasing an extended warranty for a used car with a history of repairs could save you money in the long run.
- How long do you plan to own the vehicle?
- Is the price of the warranty more or less than potential repair costs?
- What's the value of the vehicle you're purchasing?
- If the warranty costs more than the vehicle, an extended warranty probably isn't a good idea.
- Are you're planning to modify the vehicle?
- Performance modifications commonly void most car warranties.
Can I transfer an extended warranty?
Yes and no. Most extended warranty can be transferred to a new owner when you sell your vehicle, but it cannot be transferred to a different car or truck. Check your warranty information to see if your warranty is the type that can be transferred.
If you've purchased an extended warranty that has yet to expire and hasn't become void according to the terms and conditions, transferring a warranty to a different owner is possible and can even add value to the vehicle you're attempting to sell.
For a detailed list of what you need in order to complete a warranty transfer, please visit our page on Transferring an Extended Warranty.
Repairs & Voided Warranties
Do I get to choose where my vehicle is repaired?
Warranties provided by a dealership that are backed by the automaker often require all repairs to be made at a franchised dealership. If you choose to go with a third-party warranty, you'll likely have more options to choose from, though prior authorization may still be required. If you are unsure where you're allowed to take your vehicle for service, it's best to contact the provider before repairs are made.
Why is my warranty void?
Failure to abide by the terms and conditions of a service contract can cause a warranty to become void.
Common reasons that a provider might deny a warranty claim include:
- Salvaged title.
- Vehicle misuse.
- Environmental damage.
- Odometer tampering.
- Modifications made to original parts.
- Neglecting vehicle maintenance.
What steps can I take to keep my warranty from becoming void?
Following the purchase of a new car or truck, make sure you carefully read the contract. If you don't understand the wording or language, make sure to ask the provider questions to avoid confusion later.
Though specific conditions or stipulations will vary depending on the warranty and provider you select, most agreements will require you to keep up with scheduled maintenance. This includes:
- Keeping service records.
- Having repairs made by authorized mechanics.
What can I do if I don't agree with a voided warranty decision?
If you don't agree with a warranty decision by your provider, there are several steps you can take to file a complaint. These include:
- Speaking with a supervisor.
- Contacting the automaker.
- Obtaining a second opinion from a dealership.
- Filing a complaint with the Federal Trade Commission (FTC).
Will I have to pay for a portion of the repairs if the part is covered under warranty?
It depends. Some warranties require you to pay a deductible for all repairs, while others don't. Make sure you read the contract to determine what you'll be on the hook for when your car does require a trip to the mechanic.