Service Contracts: Should You Buy One?

photo of edsel warranty contract

Sellers of cars, major appliances and other expensive items may try to sell you a service contract or extended warranty. Service contracts can add hundreds to your purchase price and are rarely worth the cost. Some duplicate warranty coverage you get automatically from a manufacturer or dealer. Ask these questions before you agree to one of these contracts:

  • Does the dealer, the manufacturer, or an independent company back the service contract?
  • How are claims handled? Ask who will do the work and where it will be done.
  • What happens to your coverage if the dealer or administrator goes out of business?
  • Do you need prior authorization for repair work?
  • Are there any situations when coverage can be denied? You may not have protection from common wear and tear. And some manufacturers do not honor contracts if you fail to follow their recommendations for routine maintenance.
Source: General Services Administration
Search All Articles
Related Articles
How To Save On Closing Costs
HomecashsmMany are shocked when they learn how much they owe to close on their mortgage. But there are ways to save before you sign on th
What are the FHA Loan Requirements?
FhaThe FHA makes it easy to secure a home loan. The FHA Loan Requirements are described in detail in this article.
Homeowners Insurance
HomeinstTips on how to shop for homeowners insurance and save money-also avice on flood insurance
Asbestosdanger2_thAn information guide on asbestos and asbestos abatement. Also discusses vermiculite and how it relates to asbestos.

Most Popular
Kansas - The Sunflower State
Annual-sunflowerthumbWithin Kansas's borders is the magnetic center mark for all of North America.
Mississippi - The Magnolia State
MississippiriverthumbConsidered part of the Deep South, Mississippi, with its rich soil and many rivers, is an agricultural state.
What Should You Expect from Your Management Company?
Leadership_thThe qualities an association should look for in a management company
Homeowners insurance: What you need to know
HomeownerinsurancesmLearn more about homeowners insurance and what you need to know to best insure your home, your possessions and your finances


Zip Code Profiler

Neighborhoods, Home Values, Schools, City & State Data, Sex Offender Lists, more.

Instant Home Value!