A person’s decision to purchase a car might be one of the most important purchases of his life. It is why many customers agree to pay more for a vehicle with a protection plan, allowing them to be worry-free for a long time. Many people say that buying extended warranties for their vehicles will increase their resale value. What do you think about this? Is it just another sales pitch to entice you, or is there some truth behind it? We’ll answer that later, but first, let’s talk about the car extended warranty.
Understanding Extended Car Warranty
Extended warranties are service contracts that increase coverage, timeliness, and the comprehensive warranty for one’s used car. They are transferable, sold separately, and not included in the purchase price. They become active after the manufacturer’s warranty has expired. There is no requirement for used cars to have an extended warranty, but it acts as a security to protect their vehicles from wear and tear, thus enhancing their resale value. Factors determining whether a car qualifies for extended warranty coverage include the quality of the vehicle, the vehicle’s age and mileage, the owner’s driving record, resale values, and a licensed repair facility. It is beneficial to purchase an extended warranty if the repairs for your prized possession will be expensive in the future. A typical extended warranty policy covers the following:
- The car’s transmission, engine, and drive axel are included.
- Additional components such as heating and cooling systems, brake systems, etc., are included in power train protection.
- A bumper-to-bumper coverage plan.
- The manufacturer’s warranty might still apply to a used car, but that warranty will be limited to a few components. The extended warranty will cover any remaining parts.
How It Affect Resale Value
Getting the right price is the most challenging part of selling a used car. It is crucial to have an extended warranty on hand considering the buyers’ queries regarding unexpected significant expenses. The peace of mind with an extended warranty is also transferable to the next owner. In the case of two identical used cars, view the automobile extended warranty as more valuable.
It will be more attractive if you sell your vehicle outright rather than trading it in at the dealership if you have a transferable used car auto warranty. The fear of a breakdown when shopping for used cars without a factory warranty is common among those looking for a factory warranty. What else would motivate some people to have a vehicle inspected by a mechanic before they buy it? With a transferable extended warranty on your car, these fears are eliminated, and you might be able to sell your car quickly and for a higher price.
The good news is that you will not lose any money should you decide to sell your car after purchasing an extended car warranty. When you transfer ownership, the extended warranty coverage remains intact. Therefore, a car’s extended warranty can be an incentive when being marketed. It is one of the ways to sell a vehicle. It might be unnerving for buyers to buy a used car because it may have problems. However, if they hear that it comes with an extended warranty, they may feel more at ease. So even if you plan to sell your car soon, you should not let that stop you from purchasing an extended warranty for your used car. Your used car will fetch a higher asking price if you purchase extended vehicle protection. However, keep in mind that the vehicle is still covered even after the title has been transferred.