Should you get that extended warranty when you buy your next used car? Probably not. For most buyers, the high cost of an extended warranty for a used car outweighs the potential benefits. The warranty providers design these plans to be profitable. On average, customers pay more for the policy than they receive in covered repairs.
However, the decision depends entirely on your vehicle and your tolerance for financial risk. A warranty can provide valuable peace of mind in some specific cases. Use our guide to help determine if it’s the right choice.
What Is an Extended Warranty for a Used Car?
A used car extended warranty — more accurately called a Vehicle Service Contract (VSC) — is an optional protection plan that covers specific repair costs after the factory warranty expires. Unlike the manufacturer’s original warranty, a VSC is essentially an insurance product. You pay upfront or in monthly installments, and the provider covers eligible repairs.
When signing paperwork on your vehicle purchase, you’ll most often be offered an extended warranty in the dealership finance office. Third-party companies, including Endurance, CarShield, and Carchex, sell policies. Automakers also sell branded plans.
The cost typically ranges from $2,500 to $4,500, depending on the car’s age, mileage, and model. A plan for a high-mileage luxury vehicle costs more than a low-mileage economy car. The final cost also depends on the coverage level and deductible you choose. Because coverage terms vary, always review and understand the fine print before signing.
[Editor’s Tip: If you get an extended warranty, only buy from established, well-reviewed companies. Be wary of unsolicited calls or high-pressure sales tactics from pushy providers. — Jason Fogelson, Managing Editor]
The 30-Second Decision Guide
Answer these questions to get a quick recommendation.
| Question | If Yes… | If No… |
| 1. Does the car still have a factory or Certified Pre-Owned (CPO) warranty? |
❌ Do not buy an extended warranty. You are paying for overlapping coverage. Consider one later when the original warranty is close to expiring. | ➡️ Go to Question 2 |
| 2. Does your car’s year, make, and model have a good reputation for reliability? |
❌ Do not buy an extended warranty. Skip the warranty if it’s a reliable model. A policy is an unnecessary expense. Search Autotrader for model reviews highlighting which years are best to buy used. | ➡️ Go to Question 3 |
| 3. Can you comfortably pay a surprise repair bill of $2,500–$4,500 out of pocket? |
❌ Do not buy an extended warranty. You can likely self-insure. Pass on the warranty and put that money into a dedicated savings account for repairs. | 💡 An extended warranty may provide worthwhile peace of mind and financial protection. |
✅ Quick Answer
If you answered Yes → Yes → Yes, you don’t need an extended warranty.
If you answered No → No → No, then a vehicle service plan is worth consideration.
RELATED: Is a CPO Warranty Worth It on a Reliable Car?
Final Checklist: 5 Questions to Ask Before Buying an Extended Warranty
If you’ve decided a warranty is right for you, get written answers to these questions before you sign:
- Exclusionary or inclusionary policy? Ask for the complete list of what is not covered.
- What’s the deductible? Is it calculated per visit or per component repaired?
- Service locations? Only in-network repair shops or any ASE-certified mechanic?
- How are claims paid? Do they pay repair shops directly, or do customers pay first and wait for reimbursement? Direct payment is much better.
- Cancellation and transfer rules? Can you get a prorated refund if you sell the car? If the policy is transferable to the next owner, it might be a selling point or add to the resale value.
- MORE: Is the Factory Warranty Transferable When Buying or Selling a Used Car?
Bottom Line on Extended Warranties
Extended warranties are insurance products — and like all insurance, they only make sense in specific situations.
- Buy if: Your car’s predicted reliability is questionable, you lack savings, and you can secure an affordable, exclusionary policy from a reputable provider.
- Skip if: Your car has a good reputation for reliability, you already have coverage, or you can afford to self-insure.
For most car buyers, setting aside money in a repair fund is smarter.
Editor’s Note: We have updated this article since its initial publication.
Considering an extended warranty for 2014 BMW 750 I
Bought an extended warranty a few years ago, within a week a modulator of some type went, of course no electronics were covered,cost me $400. A mechanic friend once told me,”extended warranties cover about 500 parts on a vehicle,but there are about five thousand parts on the vehicle”.
To me, the extended warranty I purchased on the used vehicle I bought was nothing but a big waste of my hard earned money! I have been having issues and those issues have not been fixed. Now, the dealership I bought the warranty through is refusing to honor the warranty that I bought! When I called the warranty company they were zero help, which left me more frustrated than before! So now I am stuck paying for repairs out of my pocket that I can not afford. Next time I will save the money I was going to spend on the warranty! It has been nothing but a nightmare for me!
I got an extended warranty when I bought my 2002 Monte Carlo. This was several years ago. I got the extended warranty, because it was past mfg warranty. I did use it once when the Intake was leaking oil into the cooling system. I had a $200 deductible. The bill was $700, so they covered $500. The extended warranty was $3000, and added into the price of the car when I financed it. I don’t do extended warranties anymore. I got them on other cars before, and never had to use them. Save your money.
The pricing on the extended warranties is very negotiable. I bought my son a 2017 Honda Civic. I already secured the financing through a local credit union. They offered extended warranties also. The dealership offers extended warranty for 60months or 100k miles for $3000. I wasn’t going to pay that price for sure. As I sat there and thought about the whole deal I reached out to credit union and they offered a better warranty option 72 months for 120k for $1400.
I am buying a 2014 Honda CR-V with $61,000 miles on it. The seller insists on selling me an extended warranty for $2,387 6 year/80k. I don’t know if I should walk away or get the warranty!
The pricing on the extended warranties is very negotiable. I bought my son a 2017 Honda Civic. I already secured the financing through a local credit union. They offered extended warranties also. The dealership offers extended warranty for 60months or 100k miles for $3000. I wasn’t going to pay that price for sure. As I sat there and thought about the whole deal I reached out to credit union and they offered a better warranty option 72 months for 120k for $1400.
Any suggestions on an extended warranty for a 2016 Dodge Journey se? Also I was told that mopar charges a 105.00 inspection fee prior to selling you an extended warranty on a used car , does that sound right?
I guess I am one of the few who has a good story about purchasing an extended warranty on a used car.
This is such a dumb article even if the car is under factory warranty, you should invest a percentage of the value of the car to protect it. Even the most reliable cars break down. Have you seen a dealership without a service department? No, because cars break down!
Of course cars break down. But, not all cars break down within the covered insurance period. And not to the extent that the expense of the coverage makes it worthwhile to purchase the coverage. If they did, they wouldn’t offer the insurance. They are in it to make a profit. Would you pay $3,000 for a premium to cover a $500 repair? Or pay a $3,000 warranty premium for a car you paid $7,000 for? And then take a chance on their not honoring that particular breakdown? It may help you sleep at night, but that much of a premium just does not seem like good business sense.
I bought a used Zafira last week. 49000 miles. My Ford Warranty arrived today, £500! It was never discussed at point of sale, and I assume it was added to the finance as ‘fee’ . I certainly would not have paid extra for recovery as I already have it, going to take it up with the dealership, but is this reasonable to take out?
We used nationalrepairsolutions.com for our commercial vehicles at the shop. Been using them for about 5 years now and they paid all the claims we submitted. I also use them for my personal vehicles too.
The dealer told me to use Nationalrepairsolutions.com because they are a broker for all the warranty admins. So you can almost pick out the coverage and price range. Used for 3 years now paid a couple of claims plus a tranny.
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Your experiences seem to have been better than others, because National Repair Solutions appears to have a D rating with the BBB.
from someone that has bad luck with cars.. get the extended warranty lol i use nationalrepairsolutions.com they have a lot of different options and i get more coverage at a lower price and a low deductible
Extended warranty companies are still in business because they take in more money (your premiums) than they pay out (your repair costs). In other words, more people pay for warranties and do not use them than those who do make claims
same as insurance companies, do you have car insurance?
I bought a used 2012 Nissan Altima SL at a Nissan dealership. I was explained that it was a 7 year 100k mile warranty on the car and it would cost me an extra 1200 for it. I agreed being that it was already 69k miles on the vehicle and that I had got a similar warranty through Carmax with my previous vehicle that was great. Come to find out the warranty was exactly for only one year because they started the warranty at the sell for the previous owner new car purchase. Don’t buy warranty from dealership. You would be better buying a second warranty to help cover any cost.
I purchased a warranty on my used 2008 Mazda 3 purchase and I left dealer feeling I got ripped off until about 3 months later my a/c died. The warranty paid for itself when it covered the entire cost of repair including new compressor – I now feel much better that I was given the warranty option.
What is the name of your warranty company?
I bought a Mercedes SL500 that was 5 years old, from CarMax – bought the 6 yr/100K mile warranty. Never had an issue with something being denied and the first trip to the shop was over $3K, that was more than the warranty itself cost. All in I think my warranty coverage paid out over $15,000 – they lost money on this one. Now looking for another higher end used car and will definitely take a warranty into consideration.
Which warranty company did you use? Thanks.
Hello Suzanne, what’s the name of the warranty company you went with?
i just purchased a 2010 MB S550. I do want to purchase an extended warranty as the dealership did not offer one to me at the time of purchase. How can I find a reliable warranty that will cover me nationally?
I would. Have you seen how much parts and service are for an S class??
I would consider asking your local credit union or whoever you have the loan with if you have one
Carmax’s “MaxCare” extended and transferable warranties are also great — customer service is superior, we have taken our 2010 Honda Odyssey to dealer for covered repairs (weak door mounts on rear sliders – $800 twice) and never has a claim been denied. It has paid for itself and we still have 2 years and 30,000 miles remaining! This is warranty which Jeremy Clarkson on Top Gear recommends while referring to always-under-repair Land Rovers.
Hi Guys , I have one question .
We just did this and they told us that yes we do still have to pay it. Because had something happened it would have been paid for.
Hi Guys , I have one question .
most warranties can be prorated so you should be able to get some of the money back.
An extended warranty may be a danger to a customer’s if they are not fully aware about the actually facts like its terms and conditions. If that describes your situation, and you plan to keep your vehicle longer than the length of the original manufacturer’s warranty, an extended service contract may be right for you as www. warrantech.com had been taken a responsibility of all kinds of manufacturing plans.
Extended Warranty is a good product as it serves our much needed demand for paying repair cost when our manufacturer’s warranty ends.Believe me repairs can dig deep into your pocket and it can create a lot of stress.For me extended warranty has helped me to breathe easier.I should give Warrantech credit for this,their customer oriented plans and customer service is out world.
You are better off opening a 2nd savings account and putting the amount you would spend on the warranty in that account, if you don’t spend the money, then fine.
My experience with extended warranties is this, they WILL find a way to deny your claim, period.
There is ALWAYS a technicality you didn’t meet and you have just lost your money.
I would generally agree but with the exception of the Ford ESP. We have been covered on two different vehicles for well over 5000.00 and never had any resistance.
I ran into this situation with my used Acura RL.
I am going through that exact same thing right now! What a waste of money the warranty was!