A warranty is the manufacturer’s and/or seller’s promise to stand behind the product and a commitment to correct problems should the product be defective.
A warranty is a specific promise about the product. It is usually accompanied by an oral or written commitment to remedy defects for a limited time. The smart shopper will compare the warranty provisions of the merchandise, as well as its price, features, and store’s refund policy. Read the warranties to see what they cover and note what labor expenses, parts and repair problems may be excluded. When you buy the product, make sure that the warranty you get with it is in writing and includes any promises made by the salesperson. And, if you purchase a product “as is”, this means there is no warranty backing the merchandise, implied or expressed, so you could be taking a chance. Some things to keep in mind when considering a warranty:
- A warranty is only as good as the company that offers it, so the reputation of the company is important.
- Take time to read the warranty before you buy.
- Use the product according to the manufacturer’s instructions, as misusing the product could cancel the warranty coverage.
- Save the sales slip with your warranty. You may need to document the purchase date, if you later invoke the warranty coverage.
For products under warranty, if the original seller goes out of business, you may be able to arrange warranty servicing with the manufacturer. But, shipping the product to the manufacturer may be difficult and inconvenient. Watch out for elaborate conditions in the warranty which an unscrupulous merchant may use to avoid having to fulfill the items of the warranty. When shopping for the best buy, compare not only the price and the quality of the products, but also their warranties and the ease or difficulty of having the products serviced.
“Extended warranties” that are offered with the sales of cars, homes, and major appliances are not really warranties, but service contracts. Warranties are usually included in the price of the product, but service contracts cost extra and are sold separately. So you need to know what you’re getting.
- A service contract may offer only certain parts or specific repairs, so be sure to read the contract carefully. And, assume that anything not specifically listed is not covered.
- Service contracts also will not cover repairs resulting from misuse or failure to maintain the product properly.
- Service contracts are sold often by a third party, so you have to deal with a company other than the manufacturer or seller when it comes to fulfilling the terms of the contract.
If a service contract is offered on a used car, the dealer must mark the box provided in the buyer’s guide that is displayed on the window of the car. The price and duration of these service contracts are negotiable, and a buyer should not hesitate to negotiate for the best deal.
Here are some things to consider when buying a service contract:
- Will the coverage extend beyond the period of the original warranty? Because if the service contract doesn’t, you really don’t need to buy it.
- Is the service contract transferable? This is very important if you are considering ever selling your vehicle during the coverage period as you could get a better selling price.
- What specific parts and types of repairs are covered?
- Is there a deductible required and how much is it?
- Are there any specific maintenance or other actions required in order to maintain the coverage?
- Are you paying for more protection than you really need, especially if the product is unlikely to need servicing or if the expected costs of repairs is low?