How (Not) to Buy an Extended Warranty
10-02-2018, 08:36 PM
#1
Thread Starter
Join Date: Oct 2018
Location: New Jersey
Posts: 2
How (Not) to Buy an Extended Warranty
My 36 month factory warranty expires this Saturday, October 6th. Call me insecure, but I'm determined to buy an extended warranty for my 2016 Mustang and I'd like to pay a fair price for it. I asked my dealer to quote me a price for the Premium plan which would extend my warranty for another five years to a maximum of 100,000 miles. They told me they'd have to e-mail me the price which somehow took them four days. In the meantime I went to the Ford website and learned that I could buy one directly from Ford for $2910. This price seemed kind of high to me since the last warranty (same plan and terms) for a Mercury Grand Marquis cost $1150 when I bought it five years ago. Of course, the price has gone up since five years have elapsed, the Mustang cost about $5000 more and is probably considered somewhat less reliable than a Grand Marquis. Still, how could the price be almost triple the last price?
When I received my dealer's price, it was even higher at $3350. Now it WAS triple the earlier price. I started looking at other Ford dealers advertising warranties online and found a number of them with substantially lower prices. The one that I'm probably going to go with is Lombard Ford which appears to be in Connecticut. The price is a little over $1700.
Now, how can there be such a big difference? It appears that Lombard Ford has been developing an online warranty market since 2002. I'm sure they sell a lot of warranties online but I can't understand how they get so much of a lower price from Ford even considering the volume. Their website is clear that this is a Ford warranty not a third party warranty. The only complaint I could find about them online regarding a warranty was from a customer who was disputing a difference of opinion about the coverage of a part. I couldn't find anything negative at all which you would certainly expect to find is something was amiss.
I'm wondering if anyone else has purchased an extended warranty from Lombard Ford.
When I received my dealer's price, it was even higher at $3350. Now it WAS triple the earlier price. I started looking at other Ford dealers advertising warranties online and found a number of them with substantially lower prices. The one that I'm probably going to go with is Lombard Ford which appears to be in Connecticut. The price is a little over $1700.
Now, how can there be such a big difference? It appears that Lombard Ford has been developing an online warranty market since 2002. I'm sure they sell a lot of warranties online but I can't understand how they get so much of a lower price from Ford even considering the volume. Their website is clear that this is a Ford warranty not a third party warranty. The only complaint I could find about them online regarding a warranty was from a customer who was disputing a difference of opinion about the coverage of a part. I couldn't find anything negative at all which you would certainly expect to find is something was amiss.
I'm wondering if anyone else has purchased an extended warranty from Lombard Ford.
10-03-2018, 02:05 PM
#2
Banned
Join Date: Jan 2018
Location: Pennsylvania
Posts: 2,327
The extended warranties are cheaper when you get them at the time you're buying the vehicle.
Buying them after the fact, is usually higher. I would closely look over the terms of that one
from Lombard Ford...
You answered your question, as to why triple the price: Mustang cost about $5000 more and is
probably considered somewhat less reliable. They're not dumb, prone to failure = higher cost.
IF you would have gotten the ext-warranty at the time of purchase, you would have gotten the
best deal.
Buying them after the fact, is usually higher. I would closely look over the terms of that one
from Lombard Ford...
You answered your question, as to why triple the price: Mustang cost about $5000 more and is
probably considered somewhat less reliable. They're not dumb, prone to failure = higher cost.
IF you would have gotten the ext-warranty at the time of purchase, you would have gotten the
best deal.
10-03-2018, 02:54 PM
#3
Gentleman's Relish
Join Date: Feb 2005
Location: AZ
Posts: 13,090
Find out what is covered and if the warranty includes things like free towing within a certain radius or distance, how much of a deductible it has for any repairs performed under it, car rentals, are you stuck going to their designated repair shop or can you go anywhere? Do they also have a provision to help offset unexpected costs from say while you are on a road trip and you're stuck paying for extra hotel nights while awaiting repair?
My daughter just bought a used 2017 Escape with 30K on the Odo. The dealer she bought it from offered her an extended warranty. Its a 5 year/100K bumper-to-bumper (neglect is not covered) whichever occurs first from the date of her purchase so until 2023 or 130K miles, whichever occurs first. It's only offered on vehicles under the original mfg warranty so, once she hit 36K miles or 2020, she couldn't buy it.
Anyways, she can take it anywhere for repairs and it carries a $100 deductible. If she breaks down away from home and has to pay for a hotel, they reimburse her that as well (up to a certain amount per day). it also includes free rentals for repairs taking longer than two days which includes weekends so if she breaks down on a Friday and the car isn't ready by Sunday, she gets a rental on Monday.
It was kind of expensive $3,600 or 20% the cost of the car but, considering she'll be moving out soon, cheap insurance for any problems she may have and easier for her and her schedule since she won't have to rely on me and my schedule.
Personally, I don't buy them for vehicles in our household as I fix them all myself (out of warranty) and, unless you blow a transmission or engine you will never come out ahead. The transmission I blew would've been way out of any extended warranty as the car is 10 years old. Now, if they included regular maintenance, I'd consider it.
My daughter just bought a used 2017 Escape with 30K on the Odo. The dealer she bought it from offered her an extended warranty. Its a 5 year/100K bumper-to-bumper (neglect is not covered) whichever occurs first from the date of her purchase so until 2023 or 130K miles, whichever occurs first. It's only offered on vehicles under the original mfg warranty so, once she hit 36K miles or 2020, she couldn't buy it.
Anyways, she can take it anywhere for repairs and it carries a $100 deductible. If she breaks down away from home and has to pay for a hotel, they reimburse her that as well (up to a certain amount per day). it also includes free rentals for repairs taking longer than two days which includes weekends so if she breaks down on a Friday and the car isn't ready by Sunday, she gets a rental on Monday.
It was kind of expensive $3,600 or 20% the cost of the car but, considering she'll be moving out soon, cheap insurance for any problems she may have and easier for her and her schedule since she won't have to rely on me and my schedule.
Personally, I don't buy them for vehicles in our household as I fix them all myself (out of warranty) and, unless you blow a transmission or engine you will never come out ahead. The transmission I blew would've been way out of any extended warranty as the car is 10 years old. Now, if they included regular maintenance, I'd consider it.
10-04-2018, 05:40 PM
#4
Thread Starter
Join Date: Oct 2018
Location: New Jersey
Posts: 2
Thanks for the responses. First of all, I have bought all my warranties at the point when my factory warranty is about to expire. The main reason I don't buy it when I buy the car is that it is another added expense when you're already spending a lot of money and if I decide not to keep the car, you won't get as much extra when you sell the car as the added cost of the warranty. It is a bit less expensive when you buy the car but more convenient for me to wait.
Regarding your daughter's warranty, you might want to check it. It should be for an added five years since you mention the year 2023 but you might want to take a closer look at the mileage. Warranties are written in specific increments and on the Ford warranties, there is a 75,000 mile, a 100,000 mile, a 125,000 mile and a 150,000 mile which is the maximum. It's important to note that when they say it's a 100,000 mile warranty, that's 100,000 miles from the day the car is first put into service which would be the day the first owner took title to it. So if you buy a 100,000 mile warranty, it expires at the earlier of the term or 100,000 miles whichever comes first. It is NOT 100,000 miles added to the mileage you have when you buy it.
You also have to be careful to make sure that the ending date of the warranty is also correct on your contract. If you want to add five years to your warranty, you're actually buying an eight year warranty since the extended warranty is considered to start on the date the car is put in service not on the date you buy the warranty. It's pretty confusing but that's the way it works.
I bought my warranty today and it's an eight year warranty with a 100,000 miles max. That's five years added to the three year factory warranty which expires on Saturday October 6th. The warranty expires at the earlier of October 6, 2023 or a maximum mileage of 100,000 miles whichever comes first. Since I've put 27,500 miles on the car so far, I'm covered for a maximum of another 72,500.
Regarding your daughter's warranty, you might want to check it. It should be for an added five years since you mention the year 2023 but you might want to take a closer look at the mileage. Warranties are written in specific increments and on the Ford warranties, there is a 75,000 mile, a 100,000 mile, a 125,000 mile and a 150,000 mile which is the maximum. It's important to note that when they say it's a 100,000 mile warranty, that's 100,000 miles from the day the car is first put into service which would be the day the first owner took title to it. So if you buy a 100,000 mile warranty, it expires at the earlier of the term or 100,000 miles whichever comes first. It is NOT 100,000 miles added to the mileage you have when you buy it.
You also have to be careful to make sure that the ending date of the warranty is also correct on your contract. If you want to add five years to your warranty, you're actually buying an eight year warranty since the extended warranty is considered to start on the date the car is put in service not on the date you buy the warranty. It's pretty confusing but that's the way it works.
I bought my warranty today and it's an eight year warranty with a 100,000 miles max. That's five years added to the three year factory warranty which expires on Saturday October 6th. The warranty expires at the earlier of October 6, 2023 or a maximum mileage of 100,000 miles whichever comes first. Since I've put 27,500 miles on the car so far, I'm covered for a maximum of another 72,500.
10-07-2018, 04:07 PM
#5
2nd Gear Member
Join Date: Jul 2013
Location: Illinois
Posts: 150
The extended warranties are cheaper when you get them at the time you're buying the vehicle.
Buying them after the fact, is usually higher. I would closely look over the terms of that one
from Lombard Ford...
You answered your question, as to why triple the price: Mustang cost about $5000 more and is
probably considered somewhat less reliable. They're not dumb, prone to failure = higher cost.
IF you would have gotten the ext-warranty at the time of purchase, you would have gotten the
best deal.
Buying them after the fact, is usually higher. I would closely look over the terms of that one
from Lombard Ford...
You answered your question, as to why triple the price: Mustang cost about $5000 more and is
probably considered somewhat less reliable. They're not dumb, prone to failure = higher cost.
IF you would have gotten the ext-warranty at the time of purchase, you would have gotten the
best deal.
Anyone who goes to buy a ext. warranty without comparing online prices is making a large $$$ mistake !!
I get 2 online quotes ; figure the median ; Then go to local dealers to find Best Price.
I haven't had to use the online quotes yet, but I definitely would.
I lost a Trans on a 2005 Pontiac GT so it payed well on that.. [I think it was $3900 .
10-08-2018, 02:43 PM
#6
Gentleman's Relish
Join Date: Feb 2005
Location: AZ
Posts: 13,090
Thanks for the responses. First of all, I have bought all my warranties at the point when my factory warranty is about to expire. The main reason I don't buy it when I buy the car is that it is another added expense when you're already spending a lot of money and if I decide not to keep the car, you won't get as much extra when you sell the car as the added cost of the warranty. It is a bit less expensive when you buy the car but more convenient for me to wait.
Regarding your daughter's warranty, you might want to check it. It should be for an added five years since you mention the year 2023 but you might want to take a closer look at the mileage. Warranties are written in specific increments and on the Ford warranties, there is a 75,000 mile, a 100,000 mile, a 125,000 mile and a 150,000 mile which is the maximum. It's important to note that when they say it's a 100,000 mile warranty, that's 100,000 miles from the day the car is first put into service which would be the day the first owner took title to it. So if you buy a 100,000 mile warranty, it expires at the earlier of the term or 100,000 miles whichever comes first. It is NOT 100,000 miles added to the mileage you have when you buy it.
You also have to be careful to make sure that the ending date of the warranty is also correct on your contract. If you want to add five years to your warranty, you're actually buying an eight year warranty since the extended warranty is considered to start on the date the car is put in service not on the date you buy the warranty. It's pretty confusing but that's the way it works.
I bought my warranty today and it's an eight year warranty with a 100,000 miles max. That's five years added to the three year factory warranty which expires on Saturday October 6th. The warranty expires at the earlier of October 6, 2023 or a maximum mileage of 100,000 miles whichever comes first. Since I've put 27,500 miles on the car so far, I'm covered for a maximum of another 72,500.
Regarding your daughter's warranty, you might want to check it. It should be for an added five years since you mention the year 2023 but you might want to take a closer look at the mileage. Warranties are written in specific increments and on the Ford warranties, there is a 75,000 mile, a 100,000 mile, a 125,000 mile and a 150,000 mile which is the maximum. It's important to note that when they say it's a 100,000 mile warranty, that's 100,000 miles from the day the car is first put into service which would be the day the first owner took title to it. So if you buy a 100,000 mile warranty, it expires at the earlier of the term or 100,000 miles whichever comes first. It is NOT 100,000 miles added to the mileage you have when you buy it.
You also have to be careful to make sure that the ending date of the warranty is also correct on your contract. If you want to add five years to your warranty, you're actually buying an eight year warranty since the extended warranty is considered to start on the date the car is put in service not on the date you buy the warranty. It's pretty confusing but that's the way it works.
I bought my warranty today and it's an eight year warranty with a 100,000 miles max. That's five years added to the three year factory warranty which expires on Saturday October 6th. The warranty expires at the earlier of October 6, 2023 or a maximum mileage of 100,000 miles whichever comes first. Since I've put 27,500 miles on the car so far, I'm covered for a maximum of another 72,500.
Ford doesn't offer the hotel coverage nor can you take it anywhere else but a Ford Dealer.
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