Vehicle service and warranties come with your brand new car, and even many used cars. But when that warranty runs out a company will call you up and tell you that you should purchase a contract to extend your warranty in a service contract. Lots of promises are made about covering repairs, too. So, should you buy it?
Vehicle Service
The Better Business Bureau says you should definitely not buy the vehicle service contract, also known as the extended warranty. They get an amazing number of complaints about these contracts. Consumers file complaints against these companies for misleading advertising, failure to pay for covered repairs, and going out of business and abandoning them.
These contracts for vehicle service can cost thousands of dollars or just hundreds of dollars. They usually have fine print that gives them gaping loopholes that allow them to pay for nothing. They are in the business of making money, and not in business to spend money on your car. And they take that lack of duty to their customer very seriously.
The Better Business Bureau’s Report
Most of the vehicle service extended warranty companies are located in Missouri. The BBB says that the worst offenders (as of 2011) are National Dealers Warranty, doing business as Stop Repair Bills; Service Protection Direct or Protection Direct; and Car Safe or Dealer Preferred Warranties. The Missouri Attorney General has sued them all. For more information on these scam types of companies, see the BBB’s report on this particular industry.
Local Businesses
These extended warranty type of companies should not be confused with your local auto repair shop that offers an oil change contract or other vehicle service agreement. Local businesses have valid plans that are usually a good deal for their customers. It is the types of companies that are mentioned in the BBB’s report that are the rip off.
