Can You Get a Warranty on a Used Car?

The used car market is currently booming with a very high demand for used cars. However, unlike buying a brand-new vehicle that comes with a manufacturer’s warranty, buying a used car can feel a little less secure.

While newer used cars may still have a manufacturer’s warranty in place, what options are there for cars whose warranties have expired? In this post, we’ll discuss the different types of warranty available for used cars and whether getting an extended warranty makes financial sense. 

What Is a Manufacturer’s Warranty?

When you purchase a brand-new vehicle from a dealership, it always comes with a manufacturer's warranty (also known as a factory warranty or bum). This warranty starts from the moment you drive your car off the lot and protects the vehicle owner from any costs caused by mechanical or electrical failures. 

How Long Is a Manufacturer’s Warranty? 

While the length of your warranty will vary depending on the car’s manufacturer, most new car warranties will cover you from three to five years or up to a specified kilometre limit, usually between 60,000 km to 100,000 km. These warranties offer the benefit of being transferable from one owner to the next. 

What Kind of Coverage Does a Manufacturer’s Warranty Include? 

When you purchase a new vehicle with a manufacturer’s warranty, they typically provide the following coverage:

New Vehicle Warranty

When you purchase a new car, you are expected to perform regular maintenance of your vehicle to keep things running smoothly. You are also responsible for paying for vehicle components, such as tires, belts, hoses, and brakes, that need to be replaced as a result of regular wear and tear. The new vehicle warranty will provide coverage for electrical or mechanical failures. This type of warranty is usually valid for three years or 60,000 km, whichever comes first. 

Powertrain Warranty

If you have problems with your engine and transmission, this is where the powertrain warranty comes into effect. Powertrain coverage can range from five to ten years or 60,000 to 100,000 km, depending on the manufacturer. 

Emissions Warranty

The Emissions Warranty covers components that directly affect a car's emissions, such as the powertrain control module and catalytic converter. The length of these warranties is generally longer than the new vehicle and powertrain warranties, with some manufacturers providing coverage for up to eight years or 160,000 km. 

Situations Where Your Manufacturer's Warranty May be Voided

It is important to note that if you don’t perform the routine maintenance as recommended by the car’s manufacturer, your factory warranty may be void.

Is the Factory Warranty Still in Effect?

If you purchase a used vehicle that is less than five years old and with a lower mileage, the chances are that the manufacturer’s warranty is still in effect. It’s best to check with the seller to find out what type of warranties are in place, as they are transferable with a change in ownership. 

What Is an Extended Warranty?

Extended warranty coverage can be purchased to cover your repair costs after the original factory warranty has expired. Extended warranties, also known as service contracts or service agreements, can be purchased directly from the car maker or a third-party provider. 

How Do Extended Warranties Work? 

If you purchase a used vehicle with a valid manufacturer’s warranty in place, you do have the option to extend the warranty. There are two ways to go about extending your warranty:

1. Original Equipment Manufacturer Warranty (OEM)

OEM warranties are purchased directly from the car manufacturer. With an OEM extended warranty, the type of coverage offered will be similar to the coverage provided with the original factory warranty. This comprehensive warranty may also include extra features such as roadside assistance. 

2. Aftermarket Warranty

Aftermarket warranties are offered by independent insurance companies or retailers and provide similar coverage to the OEM warranty. Unlike OEMs, these warranties are customizable, so you can purchase as much coverage as you want for a chosen time period and distance. 

The costs of these warranties vary, with basic warranties designed to suit a smaller budget. A very basic extended warranty will provide extended powertrain coverage to protect against the failure of the vehicle’s major components, such as the engine and transmission. You can also choose to have a higher deductible to reduce the cost of your policy. 

What Is Covered Under an Extended Warranty? 

While the coverage for your extended warranty will depend on the manufacturer (OEM warranty) and the type of policy you choose (aftermarket warranty), most warranties will cover the following:

Vehicle Repairs

The reason that most individuals choose to purchase an extended warranty is to receive coverage for certain vehicle repairs. Repairs include the unexpected failure of the vehicle that is not related to everyday wear and tear. Such failures include engine and transmission failures. These warranties can cover both labour costs and parts replacement, but the extent of the coverage is based on the plan you have. 

Roadside Assistance

Another benefit that most plans offer is roadside assistance. This is helpful if your car breaks down and includes the cost of towing to your garage. Additionally, these plans also cover minor problems including fuel delivery if you run out of gas, and they’ll also provide a battery boost if you wake up to a dead battery. 

Rental Car Coverage

When your car is in the garage getting fixed, you’ll still need to get around for your work and personal life. Extended warranties usually provide rental car coverage to limit the inconvenience of a car breakdown to your daily life. 

Should I Get a Warranty or Not?

If you are worried about the potential need for repairs when you’re buying a used car, there are several things to consider.

Buy a Newer Vehicle

A used car that is two years old will already show a fair amount of depreciation, so if you’re looking to reduce your purchase costs and gain peace of mind with a warranty, consider buying a car that is only a couple of years old. The manufacturer’s warranty is transferable, and you can get an extended warranty later if you choose. 

Buy a Used Car From a Dealership

When you purchase a car and finance it through a dealership, the car must go through an AMVIC (Alberta Motor Vehicle Industry Council) inspection. This is a 150-point inspection that covers everything from the engine to the vehicle assembly. If any defective parts are found, they must be replaced prior to purchase. This allows you to have peace of mind knowing that your car is in good working order and less likely to need repairs in the near future. 

Check the Vehicle History Report

A car that has been carefully maintained over the years is less likely to have serious problems. Most dealerships will provide a CARFAX report for review, but even if you are purchasing from a private seller, you can check the report using the car’s vehicle identification number (VIN). The CARFAX report provides information including liens, accident history and service history.  

Purchase an Extended Warranty

Extended warranties can provide peace of mind when you purchase a used car. While the car warranty cost will vary depending on the plan, they often cover serious vehicle failures, which may save you thousands of dollars in the long run. 

How to Find a Reputable Used Car Dealership in Your Area

Do Your Due Diligence 

When you’re looking to buy a used car, do your research and visit a reputable dealership. Ask friends and family for recommendations and check out the Google used car dealership reviews. Dealer reviews are a great way to find out what other customers feel about the service.  

Visit the Dealership

Visit the dealership and ask lots of questions about their cars and any inspections that they do. It’s also helpful to know what their policy is if you run into a problem, as well as the time period in which you can take the car back. 

Purchase a Quality Used Car in Edmonton

At Insta Auto Solutions, we only sell quality used cars that we would buy ourselves. You can browse our inventory online to see detailed CARFAX reports, and if you’d like to learn more about used car dealership warranty options, come and visit our dealership. We can help you figure out the best warranty solution for your peace of mind and also assist you in securing an auto loan for your new car.