Warranty for used and recond cars; here’s what you need to know

Picture this: you recently purchased a decent-looking used car, but problems start to arise. You take the car back to the dealer whom you bought it from and the dealer tells you that the problem you’re having is not covered under warranty, despite the fact that you were told that the car comes with a six-month warranty.

What is the reason for that? After all, when you bought the car, the listing did mention that the used car dealer offers a warranty on the cars they sell.

Dealer’s listing mentioned that warranty is included

This is a classic example of dealing with a used car dealer-provided warranty, as you have guessed, can be rather vague at times.

To better understand this situation, you need to dive into the details of the warranty that the used car dealer provides. 

More than often, these warranty packages only cover very specific parts of the car, like the engine ,transmission, and cooling system; nothing more than that.

Also Read: Used car shopping: 6 tips for checking the engine

So, for example, if you are having troubles with items not mentioned in the warranty clause, like brakes or air-conditioning system, the used car dealer can deny your warranty claims. The used car dealer also won't entertain warranty claims with wear and tear items.

How is that possible?

The warranty packages offered by used car dealers are not covered by the dealers themselves, but rather a third party, usually a panel insurance company.

As such, payout for these warranty services is a case-by-case basis. If you are having issues with the items covered under their warranty, you may still be out of luck, as there are a lot of exceptions.

Also Read: Buying used cars: 6 signs of flood damage

But that’s not all.

If you are lucky enough that the dealer agrees to fix a faulty part under their warranty, there’s another hop that you need to cross: you will need to get your car fixed at the dealer’s approved workshop. Nowhere else.

But it's not necessarily a bad thing, really

Having a warranty is still a better option than having no warranty at all. In fact, for higher-end cars, a dealer-provided warranty can be seen a good option.

Now, you wouldn't want to be facing an engine or transmission issue on a high-end car within the first six months, do you?

Also Read: Why do flagship sedans depreciate like there's no tomorrow? 

Conclusion

At the end of the day, having a warranty attached to a used car can still be a good deal, especially for a car that is out-of-warranty. No matter how reliable a certain brand can be, a poorly-maintained example will still have issues and you will be glad that a warranty can ease some financial pain.

Like what we mentioned earlier, it's a good idea to vet through the warranty's terms and conditions to understand what the dealer's warranty package covers, and what it does not cover.

If you decided on buying a used car with a warranty, make sure that the used car dealer provides a black-and-white warranty document.

Remember: A verbal warranty does not mean anything. Always insist on a black-and-white copy of the warranty document.

Also, having a warranty attached to a used car is not a guarantee that the mileage has not been tampered with, as it does not necessarily warrant the car's history.

Personally, it is a better idea to purchase your used car with a full service history, ideally directly from the owner instead of a used car dealer. This way, you know that the car’s mileage was not tampered with.

Check out our other buying guides related to used car shopping below.

Also Read: Worried about mileage tempering when buying a used car? Here's how to check

Also Read: Buying guide: 5 things to lookout for when buying a used car

Also Read: Buying used cars: How to test drive a used car?

Also Read: Be wary of hidden charges when buying a used car!

Also Read: Buying used cars: 5 signs a car has been in an accident