As your new car ages, eventually the factory warranty on the transmission will expire. Replacing a transmission can run anywhere from $1,500 to more than $2,000, depending on whether you use an independent mechanic or a dealership. That large expense tempts some car owners to consider a warranty to cover the transmission, but beware of buying worthless warranties.
Beware the salesman who telephones to offer a warranty for your car, then begins asking for your credit card number or bank account number. This is a ploy to obtain personal information that can lead to identity theft.
Watch for the high-pressure tactic of a salesman who says you HAVE to buy the warranty now, or the opportunity won't exist tomorrow. This applies to car dealers, as well as telephone salesmen.
Examine the warranty carefully. The salesman may tell you that everything is covered, but the black-and-white print may differ. A bit of distrust may save you a bundle on a useless warranty and an uncovered transmission repair.
Be wary of the postcard that comes in the mail, telling you your vehicle warranty is about to expire, and requiring you to call within a limited time frame to re-establish protection. And why does the company need your VIN number if they know about your warranty situation?
Call a couple of local repair shops to see if they would repair your transmission under the warranty you are considering.
Avoid Internet auction sites for transmission warranties. Well-established companies do not need to advertise on auction sites.
Ensure that the warranty covers both mechanical breakdown and wear and tear. If the warranty covers only mechanical breakdown, the company or car dealership can classify problems with the transmission as wear and tear and deny your claim.
