Extended Warranties...Worth It?

You can report the price all day long. It’s when the source info gets tossed around that makes it bad. That info should always be given via PM.

 

I’ve bought a Toyota platinum warranty once before. I used it 3 months after my factory warranty expired. Ended up saving $800 on repairs. Got rid of my 4Runner a couple months later and got credit for the prorated unused portion. I have a 8/125k now but that was given to me by Toyota for my PCS issues.

 

I have a 3rd party, bumper to bumper warranty with a term of 7 years or 75,000 miles: $100.00 deductible, IF I go outside network. It covers replacing my windshield, for example. Or, if a module goes out or a connection shakes loose or ...

I don't put a lot of miles on my truck because it's mostly a 'local run' truck. It's a FEW BUCK A MONTH.

Now, if you put 50,000 miles per year on your truck, maybe it's not as good a deal.

 

Brand new 2019 Tundra owner here with very recent similar experience. This thread hits close to home because the topic of extended warranties is why I bought my Tundra.

I come to the Tundra world by way of my 2012 F-150 that I sold and a hard lesson learned in extended warranties. When I bought my F-150, the business manager sold me on Ford's top of the line bumper to bumper extended warranty - I paid a hefty, way-too-much price for it. I learned two valuable lessons that helped me with my recent Tundra purchase. I actually really loved my F-150, but after my experience with Ford and their warranties - I went the Toyota Tundra route.

1. The Ford so called 100% comprehensive bumper to bumper extended warranty was no such thing - and I would imagine most others are similar. I had 2 problems that were not covered (long story). Don't ever think a 100% bumper-to-bumper extended warranty doesn't have disclaimers and some parts/problems won't be covered...read the extra fine print! In my case, my truck had 2 very common problems that the warranty did not cover due to the fine print.

2. Never ever let the business/finance guy closing your deal talk/bully you into getting an extended warranty at the time of vehicle sale. You can (and should) shop around later once the emotion of buying a new car/truck subsides and approach the warranty purchase just as any other - negotiate a fair, reasonable price on your terms - not the dealers. You should take time to review the warranty, what is/is not covered at a time when you can focus and not be bothered by some pushy dealership business/finance manager over-talking why you need a warranty.

I got a smoking great deal on my 2019 Tundra (more on that in a different discussion). As most others - the finance guy tried his best to talk me into an extended warranty, service agreements, tire/wheel protection - the list went on and on. I told him about my Ford experience and I would never ever buy another extended warranty - he was tough, he kept trying to sell me - but I kept telling him no until he realized we'd be there all day long.

I learned a while back that you can buy an extended warranty before your factory 3/36 warranty expires and there are many places to get the premium OEM Warranty at a reasonable price. Dealers like to sell you the pricey warranty at the time you are financing your vehicle because they don't sell you a "$2700 7 yr/120k mile warranty", they try to sell you a "$25/month addition to your monthly payment".

Thanks to others that posted some places to find extended warranties at a fair, reasonable price.

 

I think the other reason they push it at time of sale is being able to roll the EW into the loan is an easier pitch and makes people think twice if they say no. One, you’re paying interest on that extra money for your term and two, you risk the ability to shop for a better deal. I guess it just depends on your situation if it’s easier to swallow another $30/month for 60 months or take the time to shop and pay another method.

 

When my GF bought her SUV, the dealer wanted $11k for an extended warranty up to 100k miles, forgot how many years. If her vehicle starts having problems, we'll just trade it in.

 

Thats exactly it. You never should negotiate on monthly payment. If you are smart and always negotiate an "out the door" price with the sales guys, the finance guys try to switch you to negotiating the EW on the effect on your payment when you close the deal..its subtle, and you have to be on your game.

(Reminds me of negotiating the sale of a house with realtors involved. To you $5,000 is $5,000, to a realtor, $5,000 is $150-300 in commission...each of you has a different reference point for the negotiations!)

 

Payment shoppers are a dealers wet dream

 

No on the EW for me. Most things I'll fix myself, but if expensive, PITA problems arise out of warranty then it's time to trade it in.

 

They also like to sell it there because the Finance Manager makes commission off the extra warranty/item sales. We were pushed hard to purchase this stuff, told the guy under no circumstances would we be doing that. He kept pushing, I told him he was eroding my confidence in Toyota as a reliable quality brand because of his scare tactics! He stopped.

 

Ha! That’s funny.

 

I wonder what dealers would do if everyone woke up and instead of looking at monthly payments they focused on the purchase price in total.

 

They don't have to worry about it. Way too many people out there over buying and/or overextended financially and only care what the monthly will be.......

 

You are exactly right - they use the high pressure tactics they use because they work! I said to the finance guy when he took me to his office “so this is where you beat customers into submission and sell them stuff they don’t need?”

He thought I was kidding...

My only advice is never let emotion get in the way of a major financial decision. When they try to “sell” you an EW they use fear. Most folks probably don’t know you can buy an EW afterwards up to the end of the factory warranty.

 

Man it is crazy how many folks walk in and just pay sticker price or even redonkulous dealer mark ups (TRD Pro types). "Hey man I really want that TRD Pro but I dont want to pay more than $550 a month and I dont have any down payment." Cool no problem we can get you an 84 month term at 8% with a $15k balloon payment at the end of it.

 

Hopefully you’re not upside down at that point with your vehicle. If you’re looking to trade a vehicle in that the dealership knows has a problem, they will smell blood knowing you’re between a rock and a hard place. Spend $2,000 to fix it or take X on trade-in.

I run amortization charts on all vehicles before I buy with the OTD price and how many miles per year I’m expecting to drive. I’ll even go to the extent of looking to see what a 2-3 year old car of similar trim is worth with X amount of miles just to get a basic idea of what the car will be worth 2-3 years down the road. I get that each progressing year, a car’s original purchase price is probably higher than years past and the features are probably more upgraded.

If most buyers would do this simple excerise, they’d see how deep of poop-poop they’re putting themselves if they have to sell the vehicle early in the loan. Having said that, no vehicle is considered a sound investment, but Toyota’s do hold their value and you can typically put yourself in a better position financially if you had to walk away early from the vehicle vs another brand. There’s a lot of factors here like how many miles, your interest rate, term of loan etc, did you put anything down, finance EW and tax, license, etc.

 

There is only ONE answer to the question "What do you want your monthly payment to be?"

And that is: ZERO

TommyTun is spot on, do your homework, break the purchase down to one item at a time. Work the OTD vehicle price first. If you are having the dealer do anything to the vehicle get that hammered out next. Then, if you have a trade don't even discuss it until you reach an acceptable OTD on the vehicle, then move on to the trade and don't cave in when they low ball the shit out of you.

And don't buy all the shit the finance guy (fearmonger) pushes on you. GAP insurance might be the only consideration, even that is a huge stretch for me.

 

I was offered a 10yr/150k mile Vehicle Service Agreement by my dealership and Jennifer at Wolverine told me the most Toyota offers is a 10yr/125k mile.
What’s the truth???

 

Pretty sure they max out at 125,000, but I’ll let someone else confirm. Maybe the 150,000 is something new for 2019?

 

The dealer I got my truck at is a legitimate Toyota, not some corner shop. It just got me a little sketched out about dealing with Jennifer. No offense at all to any of y’all or her, but I’m 100% my dealership is legitimate. However, I will send her (Jennifer@Wolverine Toyota) some more information about the 10yr/150k miles and see what she says.
Thanks to all in advance!!

 

I thought extended warranties did not cover oil seepage or leaks, such as the cam tower.

 

Extended warranty!! Lol I have free limited lifetime warranty (unlimited miles, unlimited years) on my tundra. As long as I follow the maintenance and still the owner.

Only Dick Hannah dealership offer this. Power train is all I need. Plus my insurance Geico has an extended warranty program added to my policy the covers maintenance repairs with the low $100 deductible but only cost a couple dollars a month. Double coverage

 

Camshaft one of the 1st things listed that is covered.

https://www.toyotacertified.com/assets/ebrochures/en/tcuv_vsa_brochure.pdf

 

Not saying yours is like that but a lot of 3rd party warranties dont cover camshaft. That is one thing i checked with every dealer when i was looking for a tundra. Only one dealership that had Free powertrain warranties covered the camshaft tower. You literally have to read their fine print to make sure you are covered.

 

I bought the 10yr/125k platinum on March 28th (the day I got the truck) for $3,100. I didn't think I would go with an extended warranty on a Toyota especially for this much money, but the dealer saved me thousands on taxes and I felt good about purchasing the warranty because I ended up getting it for the same price I was planning on paying per month anyway. I now feel like I got robbed when seeing what other people paid for the 8yr/100k... Didn't realize there was so much shadiness going on. The guy who sold me my warranty "saved" me $900 off of the "regular" price of $4k with some "Friends and Family" discount. What a load of crap. And they feed you all this BS about a "positive buying experience." Really wish I would have seen this thread beforehand.

 

I did but I look at it as another insurance that I pay.

My luck is I dont buy it and right after the primary one expires something will take a shit

 

Don’t feel bad, same thing happened to me when I bought an F-150 years ago. I didn’t learn until after the fact that you can (and should) price shop warranties!

I way overpaid for mine at the time too thinking I was getting a great deal, they play the “mark up and then give you a special reduced price” game. I guess if customers wouldn’t keep falling for this shady tactic they wouldn’t keep doing it.

When I bought my Tundra the finance guy couldn’t understand why I kept saying no...

 

Normally don’t like them. However I did get one to extend the bumper to bumper coverage when we got my wife’s 2019 Highlander mainly because of all the safety sense stuff etc.

 

Finance guys are a sneaky bunch. I have heard that dealerships put their brightest people in that job. When I bought my last Tacoma I had secured financing up front at 1.6%. Sales director said they could match that so I said OK. I don't care who I pay as long as terms are the same. I told finance dude up front that I was NOT buying warranty. After some haggling he came back with "what if you can get it for less than $10/month". He said "well I can lower your interest rate to 1.29%". I asked "were you going to offer that rate without the warranty?". He said sure. I said "well I don't believe you but I will take it and no warranty". Then he started backpedaling and said "well you agreed to $XXX/ month". I said the only thing I agreed to was the purchase price of the truck. The sales director ended up having to intervene before the finance dude ruined the whole deal.

 

I do Mechanical breakdown coverage through GEICO on our cars and don't have extended warranties on my Crewmax, my Challenger, or wife's Acura. It's like 40 bucks for every 6 months or something like that to get it for each car covered under GEICO and covers me out to 7 years and over 70K. People who've never had significant problems on a vehicle at under 100K will tell you it's not worth it. People who have will tell you they're glad they brought them. I might consider one if I get a new truck with a more recent design where the power train is un-tested. But our 5.7 and 6 speed combo has built up a solid track record in 12 years of service. My 09 Crewmax has 86K and drives like it does when I still pulled off the lot in 2009. A few minor things have had to be handled in the last couple years which is to be expected. But if you drive mine blindfolded I bet you couldn't tell a difference between it and a brand new one in terms of shift quality and drivetrain feel. I did not bother with the extended warranty and don't regret that. I also don't drive much so I tend to hit year limits before mileage, which is another reason I don't bother. You're really not getting your money's worth if you only have 50K at 7 years and the thing expires. I invest that money in early fluid changes. DIFF/TRANS case, transmission drain and fills, etc...

But I don't fall in the "Only for suckers" crowd. You have to decide your own risk tolerance.