…more precisely, should I keep the one I bought? I have about two weeks left on a 60 day cancellation period.
My 2013 Honda Accord is my first new car in seven years. The electronics…touch screen, backup camera, right turn camera, collision warning, veering out of your lane warnings… in particular made me an easy mark when I signed all of the papers.
Plus it appears to be refundable and transferrable at any time during the EW period.
If anybody is familiar with the market it is the CNA Factory Wrap+Plus Preferred product that cost about $2,000 and extends the three year/36,000 bumper to bumper factory warranty to a 10 year/120,000 mile warranty plus adds a few other goodies:
[ul]
[li]Rental Car [/li][li]Deductible Paid [/li][li]Travel Lodging if you can’t drive your vehicle [/li][li]Roadside Assistance (Flat Tires, Fuel, Lock-out, Battery) [/li][li]Sundays - Honda Dealerships are not open but any certified mechanic can be paid[/li][/ul] through a credit card machine with the CNA (800#)
Besides being an easy mark I also fell for a couple of basic “selling points” that were made that upon reflection are clearly not as good as they sounded at the time.
The fundamental question is whether I have cause for concern re the electronics or anything else on a new Accord.
The second would be whether anybody know of typical fine print that I should consider.
No. Especially not for a Honda. Most things on them simply don’t break and by the time you sell it you will be out of pocket far less than $2k fixing the few things that do, out of warranty.
The entire conversation with a car salesman should consist of:
There’s a crapload of overhead and profit built into extended warranty pricing, particularly when sold by a third party like CNA, so they aren’t a good deal…but then, that’s not why you buy them…you buy them for peace of mind just in case you need them, and sometimes based on a feeling about the underlying product.
Anyway, that wasn’t your question. With respect to fine print: is there a deductible? Is Honda’s service facility used for repairs, or can they direct you where they want?
I mean, really, six years from now are you going to pull into an independent mechanic on Sunday of Labor Day weekend to get your backup camera fixed?
I wonder why no buyer ever notices that the car salesween is basically trying to sell them on the point that the car they’re buying is such a piece of crap, and the warranty so shoddy, that they shouldn’t buy it without third-party protection.
As with any insurance, they’re betting nothing will go wrong with the vehicle that will cost $2K, and you’re betting that it might. They’re getting $2,000 up front to play with, while you wait for the 3-year warranty to run out. That said, you’re paying $23/month for peace of mind after three years, which isn’t very much money.
I did and I told them that if they have so little faith in the quality of their product that it needed an extended warranty that perhaps I was buying the wrong product.
That shut them up.
What really pissed me off was that they had already included it in the financing and when I refused it they had to go back and recalculate everything.
They actually tried to slip it through hoping I wouldn’t notice.
I have received literally hundreds of phone calls and postcards over the past few years requesting that I purchase an extended warranty on my car. No way could the company have recouped the cost of sending these, and NOTHING makes it stop. :mad:
I think the extended warranties that are shilled by the dealers themselves are slightly more legit than the ones that are sold via junk calls and spam. The former are also generally not a good financial bet, but they at least do cover most things if they do go wrong. The spam warranties are generally written in such a way that they cover hardly anything.
As the OP, don’t worry about the electronics. Them failing is rare and when they do, they’re not that expensive. With a $2k extended warranty the only thing that’s really going to let you recoup that is a transmission or engine failure and in this day and age that’s pretty unlikely, especially on this car.
The reason they push extended warranties is that they are cash cows. Most have enough loopholes, exclusions, and deductibles that keeps what they actually do to a minimum. Plus you already have 3 or so years worth of warranty so you are paying for fewer years than it looks like.
One other point to consider: Often these warranty companies are all but fly-by-night. You file a claim only to find out that they are bankrupt or completely out of business. Make sure you know who actually backs the warranty. Is it Honda or ABCDE Company?
Every once in a while a warranty will be worthwhile. Something like a transmission blows and it’s covered. But for the most part the average cost of the warranty is more than the average cost of total claims. This is how they make money. Actually that goes with most types of insurance.
What should piss you off even more is that you were charged $35-100 for them to “prepare” all that paperwork - not a governmental fee or tax, but paying THEM to do their job - at about $1,000 an hour given that it’s a matter of entering a little data and hitting print.
I have walked out on car purchases over this “documentation fee”… and unlike anything else in the whole process, dealers were happy to see me do so. It’s a jealously guarded padding we should all consider a make-or-break point until they stop doing it.
Sorry, but figuring the value of *anything *based on the payments is bullshit.
Extended warranties have so many gotchas, caveats and limitations that you’d have to buy the worst lemon sold to recoup any value. They cover a long, long list of things that virtually never break after the OEM warranty period or within their extension. And “normal wear” excludes or reduces coverage on nearly everything else.
If you’re buying a car so poorly engineered and built that you will recoup value from an extended warranty, you are buying the wrong car.
Correct. I was just pointing out the cost as a per month event instead of a large chunk. One should always read the fine print. I’ve never purchased an extended warranty on a car, but then I usually trade them in when the warranty runs out. I did buy one on a laptop, but it was after the laptop quit functioning, waited a couple of weeks, then took it in for warranty work. The warranty was less than the cost of repairs or I wouldn’t have done it.
Mr. Athena bought an extended warranty on his 2000 XTerra. I told him he was dumb for doing it, but this was back when we were just dating, and it was his car, so I didn’t have a lot of leverage. I think he paid $1K for it.
About 6 months after he bought it, he gets a letter in the mail telling him they were changing the warranty, it was no longer good at any Nissan dealer in the country; instead, it was only good at the dealer he bought it from. Seeing as we were about to move halfway across the country, this was not acceptable. He had to fight them a bit, but they eventually gave him back the warranty he had actually paid for.
As it turned out, we did get our money out of it. The catalytic converter died several years later, and I think it would have cost us at least $1K to fix it. So it turned out even. I’m not saying the warranty was worth the cost, but at least we didn’t lose money on it.
Most I’ve seen were simply third-party insurance, with all its faults, rebranded under the dealership or make name. This does appear to be a genuine in-the-family offering.
With most of the same exceptions, if you read the fine print. I’d rather have AAA for all the frills and self-insure on late vehicle maintenance and repairs, with the first installment on the insurance being buying a car that has good longevity.
I used to be a finance manager at a dealership and GM had one. I can’t speak for every manufacturer but I think most have something equivalent. We did not sell any third party warranty coverage because it is all crap and by the time you need something, they are often no longer doing business (at least under the same name).
If you plan to keep your vehicle past the manufacturer’s original warranty period or mileage, are financing and you CANNOT AFFORD a large repair bill on top of the car payment, purchasing additional warranty coverage makes sense. If you can self insure, don’t keep cars more than 3 years, or are paying cash (in which case you can sock away cash for a repair) then purchasing one does not make sense.
You can make the argument that if you can’t afford the payment and a repair bill then you can’t afford to buy the car, (and I would agree with that), however the vast majority of people I dealt with in that job were hell bent on buying cars they couldn’t afford and it wasn’t my job to talk them out of it.
