CHAPTER 12 - SERVICE CONTRACTS

f you think the more fraught with danger: Service contracts. More commonly—but car business is sleazy, there is an area that is even (^)
incorrectly—called extended warranties, these are contracts to coverrepairs on either new or used vehicles, after any remaining
manufacturer warranties have expired. A warning: this is about the densestsubject in the Guide , but potentially the most important in keeping you from (^)
getting ripped off, especially as almost half of the people who purchase acar at a dealer—new or used—get one. Let’s get started.

I

TIP: A good service contract makes budgeting much easier.

I am actually a big advocate of properly chosen service contracts, havinghad them save me thousands upon thousands of dollars personally, and

having witnessed the good they’ve done for many of my own clients overtwo decades. A well-chosen contract will give you the confidence to drive (^)
your car for longer, and will help you budget your Cost Per Mile expensesbetter. While it will increase your monthly payment (assuming you finance) (^)
$20-$50 per month, it will eliminate surprises and potentially catastrophicfailures that can run into the thousands of dollars. But before we talk about (^)
the good side of contracts, let’s discuss the bad, and the ugly.
RISKY BUSINESS