There are some amazing warranty programmes out there for used cars. Look at ones that cover not just parts failure but also wear and tear items like shocks and springs.
Matt Wrankmore
Head of FixMyCar's Garage Network
Should You Get a Used Car Warranty?
FixMyCar discusses the pros and cons of used car warranties.
Book a car repair nowEllie Dyer-Brown
Thursday September 26 2024
9 min read
Used car warranties have gained popularity as a way to ease the financial strain of unexpected repairs. But the big question on many drivers’ minds is: are they really worth it? This guide explains the pros and cons of used warranties to help you decide for yourself.
What is a used car warranty?
When you buy a new car, it usually comes with a warranty. But used car buyers don’t often have that luxury, leaving them to pay for repairs outright. That’s where used vehicle warranties can help.
A used warranty is a contractual agreement between the buyer and seller of a car. Like a traditional warranty, it outlines the terms and conditions under which the seller agrees to pay for repairs within a specific timeframe.
The repairs can happen before or after the sale of the vehicle. However, if they occur after, they must be completed within the agreed timeframe.
Purchasing a second-hand vehicle can be a stressful experience full of doubt and uncertainty. With a warranty, you know you are protected if anything goes wrong, and this extra peace of mind can be extremely valuable for some drivers.
The four types of used car warranty
Let’s explore the different options available when you buy a used car.
Dealer warranty
Dealers aren't legally obligated to offer a warranty. That said, many independent dealerships will offer one with cars they sell. The length of the agreement will vary between dealerships and may depend on the car's age. Some used vehicles may come with a free warranty, while others will offer it separately.
Third-party warranty
A third-party warranty is an independent offer typically operated by a warranty company rather than a dealer or manufacturer. Several companies offer policies like this with different levels of cover. However, most warranty companies won’t cover cars that are more than 10 years old or have covered more than 100,000 miles.
Most of the time, the more you pay for a third-party warranty, the more comprehensive the cover will be. You should read the terms and conditions carefully before buying.
Approved-used warranty
Main dealers sell cars under approved-used schemes that usually come with a reasonably comprehensive warranty in the sale price. It will typically last 12 to 24 months. Make sure you investigate what the warranty does and doesn’t cover before going ahead with the purchase.
Remainder of manufacturer warranty
If you’re buying a newer used car, some of the original manufacturer’s warranty may remain. Most car makers offer at least a three-year/60,000-mile warranty. Some offer a more generous agreement, such as Kia, which gives a seven-year/100,000-mile warranty for new cars.
A used car still under warranty must have been serviced according to the manufacturer’s recommendations for the agreement to be valid. Remember to check this before you buy. It’s also worth noting that manufacturer warranties sometimes change. Toyota’s warranty used to run for five years, but now it runs for three with annual extensions if you get your car serviced at a Toyota dealer.
Pros and cons of used car warranties
Pros
Gives you extra peace of mind and reduces stress about car problems
Helps you potentially save money on repairs
Some warranties will cover expensive repairs and problems that cause breakdowns
You will have a clear idea of what is covered and what you are responsible for when a repair is required
Warranty repairs will be carried out at a reputable garage and finished to a high standard
You might get a higher resale value if the warranty is still valid when you decide to sell the car
Cons
Warranties can be expensive
A warranty might not be worth paying for if the vehicle only needs a minor repair
Some warranties may exclude wear-and-tear items and pre-existing conditions
Some warranties require you to follow a strict maintenance schedule and document all services and repairs
You may be required to have repairs done at approved garages and dealerships
Most used car warranties will come with an age and mileage limitation
How much are warranties for used cars?
In some cases, a warranty may be included in the price of the car you’re buying. If not, the amount you’ll have to pay depends on a few factors:
The age and mileage of the vehicle
The make and model
The level of cover
A basic third-party agreement typically costs less than £200 for a hatchback like the Ford Fiesta or Suzuki Swift. If you want to cover a higher-end car or want a more comprehensive policy, you could pay £500 or more.
Another option is to set aside some money each month for future repairs.
Used car warranty extension
It is sometimes possible to get an extension on your existing car warranty. The extension is another contractual agreement that provides continued protection for your vehicle, even as it ages and has more miles on the clock. Taking out one of these agreements will cover you for a specified number of months/years or miles.
The Consumer Rights Act and used car warranties
When you buy a car in England, you will always be covered by legislation called the Consumer Rights Act, regardless of whether the vehicle comes with a warranty. Even if the car is advertised as ‘sold as seen’, dealers must abide by the Act - there is no situation in which you wouldn’t be covered.
The Consumer Rights Act is relevant because it means a short warranty of six months offered by a dealer might not be worth it. The Act dictates that when you buy a car, no matter the cost or age, it must be:
Fit for purpose
Of satisfactory quality (the age of the vehicle is taken into account)
As described in the advertisement
If a car fails to meet these requirements in the first 30 days after purchase, you are entitled to a full refund. If it fails to meet the requirements within the first six months of ownership, the fault is presumed to have existed before you bought the vehicle. The seller has one opportunity to repair it, after which they are required to offer a refund.
Crucially, the Act only applies to dealerships, not individuals selling cars, and it doesn’t cover wear-and-tear items like tyres.
What doesn’t a used car warranty cover?
Used warranties vary in what they cover, so you must review the contract thoroughly before signing it.
Most used warranties won’t cover:
General maintenance
Wear and tear
Cosmetic issues (e.g. paintwork chips and scratches)
Some will also specify parts that aren’t covered, such as the clutch. Any aftermarket modifications will void the warranty agreement, and in cases where repair work is required due to neglect or poor driving, it is your responsibility to pay.Using non-original equipment manufacturer (OEM) parts can also void your warranty.
Find out how to keep your warranty valid.
How do you make a claim on your used car warranty?
The first thing to do when your car develops a fault that you think is covered by your warranty is to contact the company or dealer that provides the policy. They can advise you about whether the issue is covered and how to get a warranty repair.
Like car insurance, some used warranties come with excess that you have to pay before making a claim. Others might limit how much can be paid out for particular faults. You will likely have to get a repair done by an approved garage.
Are used car warranties worth it?
You can think of used car warranties as a type of insurance. It will always be a gamble as to whether your policy costs less than the amount you'd have to pay for a repair.
However, they provide additional peace of mind, and it's hard to put a price on this. It can be reassuring to know that if a problem develops that is covered by your policy, you won't be hit with a costly repair bill.
But, again, there's a chance you will encounter issues that aren't covered by your warranty, meaning you'll end up paying for the policy and a repair. Providers generally don't like to pay out if they can avoid it using the terms of the agreement, so you could end up arguing over what counts as wear and tear, creating added stress.
If you think having a warranty is worth it, we recommend buying a manufacturer's extended warranty with a new car if possible. Manufacturer warranties typically have fewer exclusions than third-party agreements.
A-Z of terms and conditions
Understanding the terms and conditions of a warranty agreement can be a bit of a headache, but it’s essential that you read and understand them before signing the contract. This A-Z guide will help you decipher the riddles around warranties.
Age limit - warranties have an age-limit for cars, after which they won’t be covered
Betterment - if a new part or repair increases your car’s value, you may have to pay money towards it
Claim limit - the maximum money you can get per claim
Consequential loss - when one failing component damages another. An added expense that’s not always covered
Excess - the percentage of each claim you’ll have to pay
Garage choice - some providers require you to use an approved garage
Labour rate - how much of a garage’s hourly rate the provider is willing to pay
Mileage - many used warranties come with mileage limits
Pre-existing faults - existing faults usually aren’t covered by used warranties
Regulated provider - make sure your chosen provider is regulated by the Financial Conduct Authority, ensuring you get a 14-day cooling off period if you change your mind
Servicing schedule - you must follow the outlined servicing schedule to keep the warranty valid
Time limits - some warranties only allow you to make a claim after a certain period (e.g. 90 days)
Warning lights - the provider may refuse to pay if you ignore dashboard warning lights
Wear and tear - components that fail due to natural wear and tear aren’t usually covered
Selling your old car?
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Ellie is FixMyCar's Content Manager. She has over three years of experience writing about cars and regularly collaborates with automotive experts to provide trustworthy advice for drivers that is easy understand. Her work has been featured in Yahoo! Finance, iNews, The Daily Express and The Sun. She has a BA in English literature and an MA in creative writing from Durham University. Outside of work, Ellie follows F1 and eagerly awaits Ferrari's next era of dominance in the sport. She drives a Suzuki Swift.