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Private Car Sellers Benefitting from Extended Car Warranty

Rated 5.0. Votes: 42

Sometimes called an "extended warranty", a service contract is a promise to perform (or pay for) certain repairs or services. Although technically not a “warranty” as defined by federal law, service contracts may be arranged at any time and always costs extra. Warranties, on the other hand, ONLY come with a new car and are included in the original price. Vehicle service contracts are popularly referred to as "extended auto warranties" or "extended warranties". Use of the term "extended warranty" or "warranty" on this site is intended to refer to vehicle service contracts and not manufacturer's warranties.

The economic downturn has famously reduced the demand for new cars. The lower price of new vehicles has, in turn, depressed the market for used cars. Drivers who privately sell their vehicles are almost guaranteed to get more for it than if they trade their car to a dealer. These days, private sellers are adding an extended warranty for the automobile their selling, as a way of boosting the car’s value.

Vehicles that have an extended auto warranty are more likely to get repairs when they need them, because the owners need not worry about the costs involved. Cars with a warranty are also more likely to be better cared for, since the owner is concerned enough about the soundness of the vehicle to get a service plan for it. Perhaps most important, vehicles that carry an extended warranty mean that the new owner will be able to benefit from the advantages of a quality service agreement.

For all of these reasons, a vehicle privately sold with an auto warranty are much more attractive than those without one. Just as customers tend to stay away from “as-is” cars on dealer lots, and gravitate toward the ones with warranties, so too is the case for the people considering buying from a private owner.

Brokers such as AA Auto Protection specialize in plans for used vehicles, and are able to assist in finding the one that would work best. Consumers interested in maximizing their return in the private sale of their car can consider a car warranty a useful tool in achieving that goal.

7/11/2010 9:16:01 PM

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