I got my warranty through the infiniti dealer i bought it through. Its called Quality Gaurd+. their warranty was $1900 and it covers everything on the car except for trim and wear items. It also covers the timing belt. my car had 39k miles on it upon purchase so my warranty was good for 5 years/ 60k miles. recently i had to replace the torque converter, window regulator, rear power sunshade motor and a couple other things that was right under $5000. they even paid a week for my rental car. I had to pay a $50 deductible. I would highly recommend them to anyone. I still have 4 years/ 53k miles left on the warranty. Definitely look into them.

 

I have a 2000 2.7. I got a 3yr/30,000 mile warranty from Continental Warranty for $1600. I have probably had $9000 worth of repairs to my car. The warranty paid for itself and then some. I would highly recommend a warranty. I would own an Audi without one. Best money I ever spent. Good luck.

 

thetryal - The thing you had going for you was that it had low mileage when you bought it. Also, Quality Guard is a Nissan product. Since they were an Infinity dealership, and the car was certified by them, they were able to offer you a warranty. My car has 88k miles on it. They were not trying to give me a warranty. A one year warranty would have cost well over $3k.

Cmoney - I'm going to give them a call and see what they offer.

 

I don't generally recommend extended warranties for a number of reasons.

First, those companies are in the business to make money and they have done their research. They know through experience that they will make money on the average warranty, thus the average consumer will lose money. Yes there are those out there who spent $2500 on a warranty only have have a turbo blow up and a water pump start leaking six months later for a bill of $4200 - but those are indeed a rarity.

Second, most warranty companies require deductibles. That many not seem like a big deal, but when they require you to pay for the first $100 of a $300 bill, they only have to pay $200 which means more money out of your pocket and less out of theirs.

Third, most warranties don't cover things that are considered "maintenance" items. This includes brake pads and rotors, spark plugs, belts, hoses, tires, shocks, struts, filters, etc, etc. Yes some claim they cover "timing belts" but this is only applicable if they break - and they do require you to provide evidence that the belt was replaced at the normal intervals. Therefore if you replace your belt at 80k and it breaks at 90 yes they would cover it, but if you forget to replace your belt at 105k and it breaks at 120k....they won't be paying a dime towards your repairs. Regular maintenance is still the owner's responsibility, and in many cases they will deny a warranty claim if they can prove you didn't perform a regular maintenance item that led to the failure.

Fourth, even though many warranties are transferable, your cost is already paid. If you trade your car in, you are a basically out of luck. If you sell your car to someone after two years they might want the warranty, but you will never get your money back for it. Also, many warranties don't offer refunds in the case of the vehicle being totalled, so if you pay $2500 for that warranty and 3 months later are t-boned by a Ford F350 which results in your car being scraped.....you are out the $2500 and 98% of the time unless you added a specific rider to your policy,the insurance company will NOT reimburse you for that loss regardless of whether or not the accident was your fault. Some warranty companies may offer a partial refund, but generally it is far below the full purchase price and their proration scales leave you with pennies on the dollar.

Fifth, if you took the same $2500 and invested it in the stock market, you would probably come out ahead after 3 years. Even something as simple as a S&P 500 index fund has returned over 10% average for five years running, so that means that $2500 would be $2750 after one year, $3025 after two, and $3327.50 after three years. Let's assume there were four warranty claims during that period for a total of $2200 (average of $550 per incident).

If you just paid for those repairs yourself over that three years you would pay $2200 total, however your investment of the original $2500 would have provided you with $827.50 of investment income, so your$2200 repair charge actually results in $1372.50 out of pocket. Sounds like a lot right? Just wait.

Let's sayyou paid $2500 for the warranty, and had that same $2200 in repairs. Since there were four incidents during the time period, that is another $400 in deductible charges. So your total cost is now $2900, plus a opportunity cost of that lost investment income of $827.50 for a grand total of $3725.50!

The difference between the two scenarios? The warranty actually results in a net loss of $2353 over three years -and that is assuming you never pay one cent of interest to buy it to begin with!

Financially speaking - the odds of you coming out ahead on an automobile warranty are very slim - and this exactly the reason there are so many warranty companies out there willing to cover your car sight unseen. Used car dealers often make more profit from selling an extended warranty than they do from selling the car to begin with....and that should tell you something.

 

Costner...good points made. However:

If I had money to invest in the stock market, I would have probably done that already. Not to mention I probably would not have gotten a car with 88k miles on it. I would have been able to afford a newer car that already has a warranty.

What I am paying for is IF. If something goes wrong, then I don't have to worry about how it's going to be taken care of. I don't know if I'ma hard driver or what, buttrust me, something will go wrong. I've had to replace transmissions in a 93 Nissan Stanza (engine too), 95 Sonata, 97 Ford Taurus, 01 Pontiac Bonneville, and a 98 Blazer. Only one had a warranty when it happened. From what I hear, the tiptronic transmissions in the 2.7T are expensive and will cause me a whole lotta pain.

While you may have some valid points, financially I'm not in the position to gamble like that. If the trans goes out next month, I'm screwed. SoI'll pay for this warranty and then I don't have to hold my breathe everytime I think something is breaking.

 

And obviously you know what is best for you and your financial position, but bear in mind those payments you are going to be making on that warranty could just as well be made to yourself in the form of deposits into a separate money market account. Then, IF something goes wrong, you have that emergency fund ready to go.

If you have to pay for your extended warranty up front - well then you already have the money to invest. If you have to put it onto a credit card, then you need to factor in the interest you will pay on that card to the price of the warranty to see if the numbers work out. Of course this begs the question that if you are willing to toss a $2500 warranty onto your credit card, why not a $2500 transmission? Not a lot of difference there.

I guess at the end of the day what you are really paying for is peaceof mind. It is like an insurance policy....we all know the odds are stacked against us, but some people still sleep better at night knowing there is that warranty there, and that is exactly why Best Buy pushes one to anyone who buys a TV or cell phone or PDA or DVD player etc, etc....because they know people will buy them - and it the margins on warranties are a huge profit to the company offering them.

Again - you need to do what is best for you, I'm just providing an alternative opinion. I would hate for you to skip the warranty and 8 months from now be cursing me because your tranny went out the same week as your turbo blows and your radiator starts leaking, however as a realist I'm willing to take the chances on my own vehicle because A. I have owned warranties before and seen first hand what a waste of money they were (in my case at least), and B. because I'm in a financial position where I could afford to replace a transmission if it did die on me.

Please note I'm also the type of guy who purchases a three to four year old car because it is economically wise, whereas others purchase new for the warranty (anyone who has ever takenEcon 101 in college can tell you buying a new car for the warranty is a horrid decision, but that is another topic for another day).

Whatever you decide - I hope it works out for you, and if you do pop for the warranty, I still hope you never need it!

 

Costner. I understand your point of view completely. And if I had a nice amount of money to not worry about anything going wrong with my car, there is no way I'd buy one. But like you said, it would be that moment when everything goes wrong at once and I'd be screwed. So for now, yes I will pay for that peace of mind. Also I'm with you. I don't think I'd ever buy a new car again ...unless I won the lottery...lol.

Thanks for your input though. There may be someone else thinking about getting a warranty but are at that brink of not needing one.

 

Costner, I like the way you reason through things and lay out the financial alternatives. It mirrors my own thinking.

Here's my question: I've owned a pile of GE stock for 20 years and it did great until 2000, and then dropped and did not move. It is just starting to move now. Should I stay with it or move it into bonds which have less risk and should generate 4-5% ROI?

 

as a tech these things are always on my mind but I have to take a rest because they are so good and the need for repair is rare

 

Iam in the same boat as Blade looking for an extended warranty. I spoke to Continental today and they wanted $3000 for a 48month 100K miles warranty. I was handed to talk to the manager when I said that quote is way to high. The manager tried to convince me that the price is just right for an Audi. He was a slick talker. Anyone would have seen through his BS. Ultimately, that convinced me not to buy the extended warranty. At least not from Continental - whatever. I mentioned the Audi forum and that a member has a Conti warranty for $1600. He almost called me a liar and started spouting off 'do you believe everything you hear' speech. Slick talker for sure.

Costner - thank you for input on the subject. You have backed up my decision not to buy a warranty. Your line of reasoning and financial logic makes good sense.


J.E.T.