demarco5

So as of tomorrow I may be purchasing an 05 lariat upon inspection. How much would a warranty cost either from dealer or third party company for like a 4yr/ x mileage plan that covers everything the same as the original factory warranty?

Money is extremely tight and the truck seems to be in great shape but my whole objective in buying this is to have a reliable truck for the next 4-6 years w/o having the hassle of fixing crap (it has 73k).

I've read too many people who have so many little problems that they just bring it in to the dealer for while it's still under warranty and I would rather not get stuck shelling out $$ and time for me to be fixing it.

Any suggestions or people who have extended warranties would be extremely helpful.

bluescrew

If you have the option, buy the warrenty offered by Ford. Price wise they really arn't all that bad for a 4 year plan. I think mine was less than 1k for engine and power train with a $100 deductable. I think full bumper to bumper with no deductable was somewhere around 2k. Personally I wouldn't ever buy a car warrenty from a 3rd party.

Redneckmafia

Get the Ford warranty it is most of the time cheaper and less hassles down the road.

Mod (Ret.)

Check the "plan" carefully to verify what it covers and does not cover. Is towing included? What are the deductibles? These are questions you will want answers to.

Also note that these plans are negotiable; don't always accept the price the sales person offers; they get a kick back on the plan for selling it. Avoid adding the price of this plan into your financing of the truck. When the plan expires, and your still paying for the truck, it can cause your payoff of the loan to be higher causing negative equity. Selling or trading in the truck can cause you to be "upside down" because you owe more than the vehicle's worth due to adding in the warrantee into the amount financed.

If the warrantee is the same length as the loan, then you may be alright if the warantee is transferable to the next buyer.

Things to think about. I personally don't like the idea of financing the warrantee into the vehicle loan; I pay for it outright; I simply deduct it from my cash downpayment.

D94R

That's robbing peter to pay paul. If your warranty cost's 2 grand, and you take 2 grand out of your down payment, then you are financing that 2 grand back into the loan for the higher price of the vehicle. Whether you finance the 2grand for warranty, or because you have 2grand less for down payment, you're still financing it, just calling it something different.


I never buy the extended warranty, though I know people who have and it's paid them back. A coworker bought an 03 Excursion with the 6.0. He had the battery, alternator, and a few other things replaced by the dealership when trying to track down a battery drainage problem. The 2k he spent on the warranty quickly paid for itself.


As well, when working vehicle worth vs loan amount and looking for the 'break even' point, you usually have to pay off 2/3rds of the loan before you get to the equal or positive equity zone. Assuming you take a normal 4 or 5 year loan with an average interest rate.

Mod (Ret.)

I may have confused you with my explaination....I don't finance the warrantee into the vehicle loan; you pay more for it in intrest than what its worth.

I too rarely buy them unless it's one heck of a discounted offer. I think I've bought two in my buying history.

My down payment (minus a warrantee purchase) is well known to the sales person, so I barter down the price before any of this deal takes place.

So as an example, either I'd be putting down 2 grand on the vehicle, or one grand and buy a warrantee package. Either way, I don't finance a warrantee, ever, as I'd pay way more in finance charges for it than it's worth, and if I sell/trade the vehicle, I don't worry about that warrantee price in the loan making the loan payoff exceed the vehicles worth.

demarco5

Ok, I think I will go with the factory plan. Now I am assuming I will have to bring the truck in to have a 150ish point inspection so the dealer knows they will not be insuring a lemon?

D94R

Right, so you tell them you have 2grand cash to make down payment. Make a deal for 20k on a vehicle. So you have 18k to finance.

Now, if you buy a 1k warranty, you only have 1grand to make down payment. you now have 19k to finance on that vehicle. You're not financing the warranty into the loan, but you are financing an extra 1k on top of the 18k if you buy the warranty from your down payment money.

Either way, you are financing that amount assuming the amounts are equal (you have 2k for down payment, or you buy 1k warranty and have 1k downpayment). Whats it's called in the paper work has no meaning.

In other simpler words. Whatever you take out of your downpayment, you are adding to your financed amount.

bluescrew

Are you buying this truck from a private party or one of those fly by night used car lots? I'd be pretty leary of a vehicle purchased from a place like that. They typically buy their stock from auto auctions...which are mostly stocked by vehicles that larger dealerships won't resell due to age, mileage, or known issues. Have you checked the used inventory at the Ford dealership?

Mod (Ret.)

One last time....I'm not paying more for the warrantee than what it's worth by financing it over time within a vehicle loan. I might be financing 1K more on the truck, but I make sure the amount I pay/finance is the going price for the truck at the time of purchase/financing. My credit is good; I usually get 3 to 5 percent on used vehicles at my bank or credit union; The advantage of age and mantaining good credit for years.

I never buy new, as there is too much depreciation on a new vehicle the first three years.

In simple terms, If I pay 10K for the vehicle, put down 1K as a down payment, the truck better be worth 9K at the time of purchase. If I added in the 1K for the warantee, I'd be paying more for that warantee over the length of the loan. In most cases, almost twice it's value with all the interest.

I also don't buy warrantees anymore!

I won't hijack this thread anymore.