How to Avoid Auto Warranty Scams
Many people have received postcards in the mail or phone calls urging them to buy auto warranties, but many of these unscrupulous companies simply take money from consumers and leave them with little help when repairs are needed. Stay educated to avoid these scams.
- Difficulty:
- Moderately Easy
Instructions
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Avoid companies that have little history in the auto business. If the company goes out of business, you will have to pay for your own car repairs.
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Stay away from any dealership that claims you must buy a warranty in order for your financing to be approved. This is a common scam.
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Say "no" if your car salesman tries to pressure you into buying an extended warranty or tells you that you will not be able to buy an extended warranty later.
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Avoid scams by keeping your personal information private. Don't give out Social Security numbers or bank-account details over the phone. Don't give credit-card numbers to warranty companies unless you've contacted the company and are positive of whom you are speaking to.
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Don't make a down payment before you see the full written warranty and its terms.
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Be particularly wary if you are a senior citizen. Some companies target seniors with scams that involve high-pressure sales calls and mailings.
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File a report with the Better Business Bureau or the Federal Trade Commission if you feel you have been ripped off or targeted by a scam. Also, report the scam to the United States Postal Service if it involved mail.
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Tips & Warnings
Look for the fine print on any mail you receive. A notice that might look like it's from an auto manufacturer could just be from an after-market warranty company.
Ask whether you can take your car to any shop that is Automotive Service Excellence (ASE) certified. That way, even if you always visit the same repair shop in your hometown, you are protected when you travel.
Avoid any extended warranties that start before the car's original warranty expires. Some extended car warranties will begin the day you buy the car rather than the day you buy the warranty or the day the car's original warranty expires. This is often a waste of money.
Be wary of extended warranties on leased cars. Most leases won't last longer than the car's original warranty.
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Comments
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tom12
Feb 26, 2009
there is a special place in hell for these scumbags -
mychica
Feb 20, 2009
I have indeed been receiving calls from some place that says it wants to extended my car warranty. They have been calling since i purchased my car three years ago. Each time they call it is a recording saying it's my last chance or time is running out. However, when I ignore the calls, they keep calling! I finally allowed a call to go through to an operator and informed the guy that I was not interested and to please stop calling me. He said he would take my name off the list, but a few days later, they called again. When I informed the girl that I was not interested and that I had already asked to be removed from the list, she informed me that she had nothing to do with that and then she hung up on me in the middle of my response (and no, I was not rude). So just a word to the wise. I wouldn't buy it now even if I wanted it!
