Car Warranty 101

Depending on your vehicle's age and mileage, you can get an extended auto warranty from several places (some better than others). Some options are the internet, from the manufacturer of your vehicle (online or offline), from a new or used vehicle dealership, or from a third party broker.

Some people might find it hard to believe, but the majority of the time it's actually NOT the greatest idea to buy your extended warranty from the place that is selling you the vehicle, even if you're buying it brand new off the showroom floor!

I'll go over more detailed topics shortly, like where to get the best deal and price, and also the different types of coverages that are available (they are not all created equal). For now however, we'll just go over the basics so you have a good foundation to work with.

Here's a zippy overview of how a reputable extended warranty agreement works:

* You pay a determined amount for the warranty. After a waiting period, your auto is then covered for a number of years OR miles on the odometer, whichever happens to come first. Always need to be aware and sure that you get a warranty that'll fit your driving habits, so that you don't end up in the sticky situation of running out of your years before your miles...or vice versa!

* Your extended warranty only covers mechanical repairs (things like the engine, transmission, electrical issues, air conditioning system problems). It doesn't, however, cover such things as routine maintenance. That means services like oil changes, tire rotations, tune-ups.

* Certain service agreements require that you pay for your repairs out of pocket, then submit receipts for reimbursement, AFTER repairs are approved. For your bank account's sake, stay away from this type of warranty at all costs. Too often they're set up so that your claim is denied after you've already paid for all the repairs. Be sure that you always choose a service agreement where your service facility is paid directly and upfront by the warranty administrator with a company charge card BEFORE repairs are done, not after.

Here's how smoothly it works when you do your homework (don't worry, I actually kind of do your homework for you with the resources I've provided) and get a quality, reputable extended warranty:

Whenever your car, truck or SUV needs a repair, you just take your warranty to your mechanic, they diagnose it, submit the claim, and fix the problem as soon as the repairs are approved/paid for by the claims administrator.

Depending on which type of extended warranty you have, you might also have to pay a deductible. Some service facilities request the deductible up front. Others let you will pay it after you pick up the car once it's been fixed. Be sure you're getting the correct deductible for your vehicle's needs, since choosing the wrong one can cost you a bundle in the long run.

Some extended warranties also offer services like:

* Rental Car Coverage- Reimbursement for a rental car, when your vehicle is in the shop having work done.
* Roadside Assistance- If your battery dies, or you run out of gas, get a flat, or lock your keys inside your vehicle.
* Trip Interruption Benefit- Most peoples' favorite: Reimbursement for food/lodging costs if your car has a breakdown 100 miles away from home or more.

So, that's it for the intro! Now you might want to learn more about how to save money and make sure you're getting the right warranty.