What's an extended vehicle warranty?
Most new vehicles purchased these days come with a warranty - this is an agreement between the manufacturer and the customer that should anything break, malfunction, or otherwise go wrong with the vehicle within a certain period of time (typically 3 years or 36,000 miles, whichever comes first), then the manufacturer will repair or replace the component at no cost to the customer.
Extended auto warranties are designed to offer similar peace of mind by literally extending the length of time a customer can expect to receive such coverage.
How an extended warranty can give you peace of mind, and what to look for.
Getting a car extended warranty can keep you from stresses of experiencing the stalling of your automobile. Although all new vehicles are sold with a warranty of some kind, you should consider an extension unless you are certain you will be selling your vehicle quickly and moving on. An extended automobile warranty gives you more than just the peace of mind of knowing that you are covered for repair bills. Depending on your lifestyle and circumstances, you may well need your vehicle as part of your work. A vehicle extended warranty can provide you with a rental car during the time that your own vehicle is being repaired.
Adding an extended warranty to your vehicle can be done at the time of purchase and can be built into your payment plan. In reality, the term warranty is confusing, as the product you buy is really a motor vehicle service agreement or a service contract. Whether this is worth considering depends on your own individual case. Extended warranties should definitely be considered by anyone who is thinking of keeping their vehicle for any length of time, especially if they use it as part of their work.
Usually as a standard package, Taggart Motor Co. offers an extanded 4 year or 100 miles service aggreement for vihicles with less than 50k miles. We also off a 2 year 24k mile warranty for vehicles that have between 60k - 100k miles. These warranty usually cost as little as 30 per month. Not only do we offer a great warranty we also have a A.S.E. certified service depatment that can handle all your repair needs. Adding a warranty to your new purchase can give you the peace of mind when a repair is needed for your vehicle.
When you drive your new car off the lot the value of your vehicle plummets, sometimes as much as 20%-30%. Say for instance you pay $25,000 for your new vehicle and have an accident a month later. You probably have only made at the most one payment and if you did not put any money down your loan amount is still close to the $25,000 purchase price. Unfortunately, even with full coverage, which includes comprehensive and collision, you will only receive the market value of your vehicle which could be as much as 20%-30% lower than the purchase price. That means you may be stuck paying that 20%-30%. On a $25,000 car, just a 20% depreciation would be $5,000! That amount could be more if you financed your taxes and license into your loan.
GAP stands for Guauanteed Auto Protection. Most people just use the term GAP to represent the gap in coverage between how much one owes on a car and how much the car is worth. GAP insurance is necessary in almost all cases and is reltivily low cost. GAP insurance is a must if you are buying or leasing a new vehicle and should not be something that you decided to skip to cut costs.
What is credit life insurance.
Here at Taggart Motor Co., we occasionally have to answer questions about credit life insurance. This might be a good time to explain it. Credit life insurance is a form of term life insurance. Term insurance refers to an insurance policy that is in force for a fixed period of time and cannot be renewed. It is also a form of life insurance that builds no cash value. In addition to being a term life policy, credit life insurance is a decreasing term policy. This means that the policy is designed to cover the amount of the loan. As the loan is paid off, the amount owed decreases and the amount of life insurance also decreases to match the loan balance.
1. How you pay for it
When you buy credit life insurance from a car dealer, the amount of the insurance is added to the finance contract and you pay for it as part of your monthly car payment. Because it is part of the finance contract, you are paying interest on the insurance premium as well as the car.
2. Should you get credit life insurance?
That is a decision that is entirely up to you. Here are the facts:
You shouldn’t get it because:
a. Generally speaking, credit life insurance is more expensive than separate term life insurance.
b. In addition to paying the insurance premium, you are also paying interest on the insurance premium.
c. If you are single and the loan isn’t paid off, your family has no liability.
3.The Bottom Line
Whether or not you take credit life insurance is a decision that you will have to make. If you have a family and are worried that they might not be able to make payments on your car if you die, you might want to look at the costs of term life insurance before you sign on the dotted line for credit life.
