Extended Service Contract for used 2014 Chevy Silverado

[NY Pirate Princess]

We found the perfect pick up for the perfect price, but then gave in at the finance table last night and purchased the extended bumper to bumper contract. It only goes 3 years and has a 100 dollar deductible. I want to cancel it in the 60 day window but the husband is nervous to do so. Cost with tax is almost $3000. Truck comes with factory power train warranty through 12/18. Should I cancel?

 

[Jen and Ashwin]

We found the perfect pick up for the perfect price, but then gave in at the finance table last night and purchased the extended bumper to bumper contract. It only goes 3 years and has a 100 dollar deductible. I want to cancel it in the 60 day window but the husband is nervous to do so. Cost with tax is almost $3000. Truck comes with factory power train warranty through 12/18. Should I cancel?

There are some independent warranty companies you might want to look into and compare. Three years is not very long. DH bought a Volkswagen Golf Sportwagen last April and since the car is pretty much covered under factory warranty for the first year, we always wait to buy coverage until close to the 1 year mark. We purchased through USAA's Purchase Protection Program which is run by Assurant Solutions. I actually bought the policy yesterday, about two months before the 1 year mark. It cost $1383 for 6 years/ 75000 miles. (The 6 year/100,000 mile policy was $2000.) There is no deductible and it covers a rental car, lodging (if the car breaks down more than 100 miles from home) and emergency roadside assistance too. This will take the policy until February 2023 when the car will be just shy of 7 years. This was much cheaper than buying through the auto dealer. USAA also allows you to pay in 18 monthly installments with no interest.

I had a policy through the same company with my old VW Jetta and used it right before it expired. The service was great and I had no issues making a claim.

 

[supersnoop]

Should I cancel?

Yes.

Do you think you'll have $3,000 with of covered repairs in that 3 years? I think it's doubtful, but you know better how you'll use and care for the truck.

 

[tvguy]

You probably should cancel it and put the $3,000 in a bank account for auto repairs. Extended warranty companies know the odds are they will never pay out $3,000 in repairs, because if they did, they would be out of business.
Now, full disclosure, I DID buy extended warranties (6 years, 100,000 miles ) on my kids used cars because they were going away to college and I wanted the peace of mind that if something happened, they could just take them to the dealer, pay the $250 deductible and they would be fixed.
Reality check, neither car needed a single repair in 6 years or 100,000, so all I bought was peace of mind.
Both cars were one year old Hertz rental cars, both were Ford Tauruses. The first a 2006 purchased in 2007 with 25,000 miles on it. It has 140,000 miles on it now. The second was a 2007 purchased in 2008 with 29,000 miles on it and it has 80,000 miles on it now.

 

[missnic]

Did you research the vehicle in depth? Does anything tend to break on that model? Is there anything about the truck history that might make you think you'll need it?

I just bought a new Outback, and was going to buy the extended warranty - I don't think it was anywhere near $1k/yr though. But the bank I went through offered a complimentary 10 year warranty with a slightly higher APR. No brainer. I like the peace of mind.

 

[kymom99]

When I bought my car it was certified used. It came with 100k mile extended but the person conducting the sale offered me additional coverage for a certain price. Not beyond 100k but it covered things that the basic warranty didn't cover. I declined it and good thing I did. I have 92k on the car now and have never used the basic warranty.

However, my husband bought a dodge intrepid brand new in the early 90s. He bought the extended warranty and used it several times since that car was a very expensive piece of crap. When he was looking at cars he learned that the cost of the warranties is negotiable. One place quoted 1200 and another 800.

I think what you bought is way too expensive. What year us the truck? Is there any of the factory warranty left?

 

[tvguy]

When he was looking at cars he learned that the cost of the warranties is negotiable. One place quoted 1200 and another 800.

I think what you bought is way too expensive. What year us the truck? Is there any of the factory warranty left?

Yes, shop around on the internet. In my case, there was a Ford Dealer on the east coast selling the Ford extended warranty for hundred less than any local dealer would. A salesman friend told me the mark up on warranties is huge, and some dealers like the one I used decided its better to sell lots of warranties at a low profit margin than a few at a high profit margin.

 

[disneedee]

my husband works for a ford dealer and we always buy the extended warranty on the used vehicles we get. (can't afford new vehicles)
he works in the service department and deals with these daily. some are worth buying others are not. check with someone in the service department where you will take it for repairs and see what they say about that policy. we have definitely used our extended warranty. when the manufacture warranty goes out is when things start falling apart, murphy's law.

 

[NY Pirate Princess]

OP here. I called the dealership this morning and told them we did not want the service contract. The finance person wasn't happy, but she held the paperwork and we returned this morning to reprocess without the 3000. There is an 18 month balance on the factory power train warranty included in the sale.

The vehicle will travel less than 5000 miles per year. The cost wasn't worth the value to us. Not on the front end, while we have a perfect shiny new toy in front of us that works magnificently! Only time will tell if we made the right choice. I felt uncomfortable at the closing table. We also put a large deposit down but the finance person rolled the service contract into the financing. No good.

We spoke with a friend in the business who said the vehicle is reliable and the cost was too high.

Thanks everyone for your advice.

 

[Ranger111]

Depending who you believe the 2014 Silverado is about average for reliability or as Consumer Reports puts it for the 2014, The 2014 Silverado pickup truck is a problem-child for the company, suffering from many early bugs. They’re the least-reliable...in our survey.

Extended warranties seldom make sense, however, pPersonally, if I bought that rig, I would at least consider getting an extended warranty, I wouldn't do it, but I would consider it. Of course, I do much of the work myself.

Reality check, buying that warranty at the dealership at the time of purchase is like begging to be fleeced. If you reconsider purchasing one, research articles on how to buy one, call other chevy dealers, see what they would charge, etc. USAA I sure would be a good choice.

 

[kymom99]

I know when you are making a deal you can get nervous and second guess things. Good for you that you thought it out and did what was best for you. Lots of pressure in purchasing a vehicle for sure.

 

[Anthony1971]

The Silverado is a workhorse truck... Few people (at least where I am from) would pay the price for a daily driver... plain and simple the truck is meant to haul stuff period... and it will be rated as such as far as consumer reports are concerned... in other words the majority of owners beat the poop out of them... I think you will have it for a long time hopefully trouble free... I see a good number of daily driver 15-20 year old Tahoe's and Suburban's around that look better than some 2 year old cars...pickups are not big by me..

 

[tvguy]

The Silverado is a workhorse truck... Few people (at least where I am from) would pay the price for a daily driver... plain and simple the truck is meant to haul stuff period... and it will be rated as such as far as consumer reports are concerned... in other words the majority of owners beat the poop out of them... I think you will have it for a long time hopefully trouble free... I see a good number of daily driver 15-20 year old Tahoe's and Suburban's around that look better than some 2 year old cars...pickups are not big by me..

Lord, I hope it lasts more than only 15-20 years. My Suburban will be 30 in October.

 

[dclpluto]

Why would you get that contract? Better yet why would you buy that vehicle if you thought it was going to need over 3 k dollars in repairs during the vehicle 4-6 years ?

 

[dreiwhit]

I once bought an extended warranty on a used vehicle because the finance guy was very hungry - If he sold X number of extended warranties, he would get a free week long trip to the Carribean. I was able to talk him down to a rediculously low interest rate (I think it was 1/4 of the going rate) just because he needed another warranty sold!

 

[daughtersrus]

I know that you've already made your decision but I wanted to throw this out there.

My DH has worked for a Lincoln dealership for over 32 years as a journeyman technician. Even with him knowing how to fix our cars, we always purchase an ESP. The price of parts can be high. I think that he said that there are over 20 computer modules in each vehicle. If one goes out, it can be expensive. That being said, the price of an ESP varies from dealer to dealer.We paid $840 for a 6 year/60,000 Ford Premium Care ESP on a new car. Of course it's really not 6 years/60,000 since it has a new car warranty. This price was $50 over dealer cost. I tell you this just so that people understand that they can negotiate with the finance person on the price of the ESP just like they do with the sales person on the price of the vehicle. He's always said that the finance person is the highest paid person at his store. They make commission on the warranty, fabric protection, outer protection... (we don't purchase those). If you can't find anyone that takes the warranty, the customer has to pay full price. It can also take longer to repair vehicles with after market warranties. Many of these companies require that they send someone from their company out to verify the problem or for the technician to send pictures for someone in their company to review before they will authorize a repair.

Another thing to keep in mind is that many repair places do not accept some after market warranties and if they do, the customer may still end up owing more than the deductible. At his dealership, if a customer doesn't have a Ford ESP, the customer may have to pay the difference between what the warranty company will pay and what the dealer charges. After market warranties can also take longer to repair. Most require that they verify the problem before they authorize the repair. This means that the tech has to take the car apart and leave it sit while they wait for someone from the warranty company to come out and inspect it. Some require that the tech take pictures of the problem and send them to be reviewed.

 

[tvguy]

I know that you've already made your decision but I wanted to throw this out there.

My DH has worked for a Lincoln dealership for over 32 years as a journeyman technician. Even with him knowing how to fix our cars, we always purchase an ESP. The price of parts can be high. I think that he said that there are over 20 computer modules in each vehicle. If one goes out, it can be expensive. That being said, the price of an ESP varies from dealer to dealer.We paid $840 for a 6 year/60,000 Ford Premium Care ESP on a new car. Of course it's really not 6 years/60,000 since it has a new car warranty. This price was $50 over dealer cost. I tell you this just so that people understand that they can negotiate with the finance person on the price of the ESP just like they do with the sales person on the price of the vehicle. He's always said that the finance person is the highest paid person at his store. They make commission on the warranty, fabric protection, outer protection... (we don't purchase those). If you can't find anyone that takes the warranty, the customer has to pay full price. It can also take longer to repair vehicles with after market warranties. Many of these companies require that they send someone from their company out to verify the problem or for the technician to send pictures for someone in their company to review before they will authorize a repair.

Another thing to keep in mind is that many repair places do not accept some after market warranties and if they do, the customer may still end up owing more than the deductible. At his dealership, if a customer doesn't have a Ford ESP, the customer may have to pay the difference between what the warranty company will pay and what the dealer charges. After market warranties can also take longer to repair. Most require that they verify the problem before they authorize the repair. This means that the tech has to take the car apart and leave it sit while they wait for someone from the warranty company to come out and inspect it. Some require that the tech take pictures of the problem and send them to be reviewed.

LOL. You are a lucky woman to be married to a mechanic who will even consider buying a NEW car. Most mechanics I know won't even consider anything new, or with less than 200,000 miles on it!

 

[DCJ]

$3000 is high. Its always a gamble not having an extended warranty, but you have powertrain coverage left still. Extended warranty companies do a pretty good job of coming up with reasons why they don't have to cover your failure. They have been using more used parts as well; engines, transmissions, etc. And "bumper to bumper", you'd be surprised whats not included in between those bumpers. I would have run away from the $3000 they tried to sell you, no wonder they were upset you decided against it.

 

[familyfirsttimer]

We bought one this year for our used car because they salesman said it is all the electronics and everything too versus just a powertrain warranty. Ours was closer to 2k and it really was peace of mind on my behalf buying a used car. I guess time will tell if it was really worth it or not. Ours is Allstate and if covers more roadside details than our insurance company did and also covered tire repairs/replacements in full and we were driving on an 8 hour roadtrip the next month. I am totally with you on the wondering if it was the right thing to do. Glad you were able to cancel once you felt it was not worth it for you.