Car Buying Questions

If I Don't Buy The
Prepaid Car Service Contract...
Is My Factory Warranty Void?

A car buying question from a California visitor...
An out right lie about a prepaid car service contract.

I bought a new car from a well-known dealership that includes a 3yr/36,000 mile factory warranty. The finance manager told me about the prepaid car service contract, or warranty maintenance (from the usual every 5,000 miles oil change;tire rotations;every 15,000 miles coverage) plan and it was not included.

If I don't buy this warranty I was told that I can lose my 3yr/36,000 new car factory warranty which I don't want to do, so I had to buy the prepaid maintenance warranty.

However after I signed my contract, I noticed it said "(Optional) Service contract". I am only 5 business days excluding weekends from my purchase date. I normally go to AAA for car services.

Does this mean that I can still cancel it? Thanks.

Answer:

This is once again a perfect example of how Finance Managers can stretch the truth and in this case it sounds like an out right lie. When you are done reviewing my answer here, I'd suggest that you take a look at a page I created just about this type of deception: exended warranty scam.

This sounds like a Finance Manager that, instead of selling the benefits of the prepaid maintenance plan, used scare tactics to make the sale.

Yes, this prepaid maintenance plan can be canceled and you should receive a full refund. Check the cancellation portion of the contract to for complete details.

The only bad thing that may apply is that the refund will more than likely go towards your loan payoff and your payments will not be lowered. You'll have less to make, but your payments will probably stay the same.

Your 3yrs/36,000 miles warranty will stay in affect, but you would want to be sure to have the car regularly maintained and follow the owners manual in order to not void your manufacturers warranty.

You don't necessarily have to follow it to a "T," but don't let the oil become sludge between oil changes.

I hope this helps to answer your question about prepaid car service contracts, but if not, then please don't hesitate to contact me again.
Justin