It can be stressful to have to pay for unexpected car repairs, which is why there’s comfort in having a warranty. However, even if you do have one, it might not last for as long as you realistically need it to. Most new cars come with a warranty that will cover services and mechanical problems for up to three years or 100 000km, whichever comes first. Second-hand-car warranties work in a similar way. When a warranty expires it means potentially having to face the crunch alone when it’s time for repairs.
But it’s not all downhill from there. ‘The expiry of a warranty isn’t something to panic about because there are several options available to suit whatever financial position you’re in,’ says Gary Ronald from the Automobile Association (AA).
‘It has become common for people to sell their cars when the warranty expires but it’s not a necessity,’ says Derek Hall-Jones, the AA’s technical services divisional manager.
‘The “conventional wisdom” of selling your car when the warranty is up is actually a second-hand-market buyer-driven phenomenon. Buyers who want to purchase pre-owned vehicles will generally look for single-owner vehicles in good condition, preferably with low mileage and a traceable dealer service history,’ he says.
‘If it’s sold back to the original dealer network you can usually break even or, depending on the vehicle’s condition, realise a small profit to put towards a new car.’
But before getting into any new deals, you should look carefully at your financial situation. Can you honestly afford a new car? Do you really need one?
‘Buying another car isn’t a choice to be made lightly,’ says Hall-Jones. ‘The cost of refinancing a new vehicle must be considered against the trade-in value of the existing one. Because of price increases, a new model will usually cost more and could therefore result in a higher financial burden.’
Extending your warranty is less expensive than buying a new car. ‘Most original equipment manufacturer dealers – including Mercedes, Toyota and Hyundai – offer extended warranties on your existing vehicle with subsequent servicing, giving the consumer extended peace of mind with their existing purchase,’ says Hall-Jones.
A warranty extension ensures that your car repairs will still be paid for but there are some conditions, such as a cap on the amount of repair work that will be covered.
‘A lot of extended warranties will cover only a percentage of repair costs, so understanding exactly what costs you’ll be responsible for is essential,’ says Ronald. ‘Read the fine print and try to find an option that works best for your needs.’ It’s recommended that you take out an extended warranty as soon as possible, even before your current one expires, to minimise costs.
Continuing without a warranty is also an option but it’s one that could end up costing you a great deal of money in the future if you don’t take good care of your car.
‘Notwithstanding the fact that all mechanical systems deteriorate over time and with use/abuse, if someone has driven and cared for a vehicle appropriately during the warranty period, there is no reason why it cannot enjoy a significantly extended service life,’ says Hall-Jones. ‘This will also ensure that the cost of subsequent maintenanceis contained to within normal limits.’
Making sure that your car goes in for scheduled services even after the warranty has expired will save you money in the long run. Since you’ll no longer be bound by any contracts, you can choose where you want your car to be serviced and repaired at a price you can afford. It’s recommended, though, that you only go to reputable establishments. The AA has a number of accredited repair centres and service stations across the country to help you keep your car in tiptop condition – with or without a warranty.