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WARRANTY

How to Lease a Demo Car

July 15, 2015 by admin 3 Comments

Buick LaCrosse
Make sure that the demo model you want is free of scratches.

Savvy car shoppers know that if you want to save big bucks on a newer car, then buying a certified pre-owned (CPO) vehicle is a wise strategy. Certainly, the first year of car ownership brings with it the most significant drop in depreciation. Suddenly, that new car bought for $33,000 new, may be worth less than $25,000.

You may not have to wait a model year to enjoy the perks of a used vehicle and the depreciation cost absorbed by someone else. Indeed, cars with just a few thousand miles on the odometer are routinely sold by new car dealers, vehicles that served as demo models for a few months and are now ready for sale.

Buying a demo (demonstration) car is easy, but can you lease one? Yes, you can. In fact, just as most any new or late-model vehicle can be leased, so can a demo car. But before you sign on the dotted line you must perform due diligence. So, then do the following:

Inspect With Care

Just as you would do with any used vehicle, examine the demo car very carefully. Likely, it is as shiny and appealing as any new car on the lot, but it could possess a few flaws that might be revealed through careful inspection. Keep this in mind: scores, if not hundreds of potential buyers may have tested the vehicle.

Look for nicks or scratches that may have been touched up. Look closely at the seats, the dashboard, and the carpeting for signs of wear and tear or discoloration. Lift the hood and verify that the oil, transmission fluid and coolant is clean, the connections are secure and that the battery is in top condition. Examine the trunk for signs of water intrusion by lifting the floor cover. Having your own mechanic examine the vehicle can be a wise decision too.

2015 Volvo S60

Obtain a Vehicle Report

The dealer’s maintenance records may be detailed, but you should also be supplied with a vehicle history report even if the car was only used for two or three months. This report should be automatically supplied by the car dealer and at no cost to you.

Most dealers will supply a CARFAX report outlining information about the vehicle’s title, ownership and mileage history. It should also include service information and if there was an accident that was reported, that detail will be included. A minor fender bender may not be much, but anything greater could be a deal breaker.

Warranty and Related Information

What sort of warranty coverage is the dealer offering with the demo model? It should come with the balance of the new car warranty as well as powertrain and rust protection. For manufacturers offering new car maintenance for the first two or three years of ownership, the demo vehicle should assume same. (Here is an excellent article that details the limits and sometimes the pitfalls with vehicle history reports — Limitations and Problems with Carfax or any Vehicle History Report).

If you’re interested in purchasing an extended warranty, your demo vehicle should be eligible for a plan. You can purchase a plan through the dealer our buy one independently. Shop around and compare offers and prices.

Chrysler 300

Find a Demo

New car dealers may have demos in use, but that doesn’t mean that one is available for sale. Here, you will want to call several local dealers and ask if they have demos available. Those cars may be included in the dealer’s online inventory too.

Take your time shopping for a demo and you may come up with a like-new car at a bargain price. Once you find a car that meets your criteria, then discuss your leasing options with the dealer. You should bargain the best price for the car and ensure that the warranties run as long as the lease.


See Also — Where Can I Find My Car Paint Code?

Filed Under: Ownership Experience Tagged With: CAR PRICES, CARFAX, DEMO, DEMONSTRATION CAR, LEASE, LEASING, MAINTENANCE, REPAIRS, TIPS, WARRANTY

About Your New Car Extended Warranty Plan

March 30, 2013 by admin Leave a Comment

You have just concluded a deal to buy a new vehicle when the salesman’s talk turns to something you had hoped he would not bring up: a new car extended warranty. Your purchase already includes a bumper-to-bumper warranty, a powertrain warranty, a warranty against rust and even roadside assistance. New car extended warranties are not cheap and you think that you can do without one. Your thinking is probably right.

Extended Warranty

Before you sign on the dotted line for a contract that may not worth its price, consider the following points:

1. The warranty may be redundant. An extended warranty is really a service contract, what covers the cost of certain parts and repairs on your vehicle. What you might not know is that the warranty may kick in right away, overlapping your current coverage. If it does, you may be paying for something that you are getting anyway.

warranties2. An extended warranty may be offered for the wrong reasons. Be careful if a car dealer insists that you need to buy a service contract as a condition for new car financing. That assertion is usually a false one and can be disproven with a call to your lender. Check your sales contract, too, as a dishonest dealer may tack on a service contact without your knowledge.

3. The company that holds the warranty may not be the manufacturer. Some car manufacturers offer extended warranties and back these just as they do with their other warranty coverage. Some contracts, however, are held by third parties or administrators, companies that pay out claims. If your administrator goes bankrupt, who will pay for the service? You may also want to contact your states insurance commissioner to learn if the contract is underwritten by an insurance company. If so, find out if complaints have been made against the insurer and whether it is solvent.

4. The service contract may cost you a mint. When offered a service contract, you may discover that there are several levels of coverage available. Compare each plan and learn if deductibles apply. Some plans charge a deductible for each part replaced while others deduct only for the entire service order. Quite easily, you may find yourself agreeing to a service contract that will cost you thousands of dollars. Consider how long you plan to keep your vehicle, whether the contract is transferrable or if it would simply be more cost effective to bank your repair costs as you go along.

5. The quality of parts used. Replacement car parts can be terribly expensive. They can also be of varying quality too. You want to find out if the car parts offered are new or reconditioned. You may also want to consider how reconditioned parts may be treated by your manufacturer should something go wrong. Parts should be readily available too — you don’t want your car to sit in a shop while you wait for an overseas delivery to come in.

6. Know who can and will fix your car. You buy a service contract through your dealer and the fine print reveals that you are restricted where you can take the car for service. Okay, fine. On further inspection you learn that those places are limited to the dealer and his network, but that does you little good if you need service while out of town. Moreover, if you should move away and take your car with you, then what? If an extended warranty is restricted by geography, you may want to look elsewhere.

Personal Considerations

There are a few more matters for you to consider when exploring your extended warranty options.

First, what are your responsibilities as a consumer? You still need to follow the owners manual when maintaining your vehicle.

Second, can you buy the service contract later on? It can be easy to get pulled into something that you do not want or need only to find it difficult and costly to cancel the contract later.

Third, are you getting roped into a scam? Most such scams happen away from the dealership as third parties learn that your current coverage is about to expire or may think that you did not opt for a service contract. Hang up on those callers and shred posted solicitations.

When all is said and done, do you still need an extended warranty? Maybe not. Understand what coverage you are getting with your new car and, if you want long-term coverage, you may be better served to shop for one when your new car warranty is about to expire.


See Also — What to Look for in a New Tire Warranty

Filed Under: Ownership Experience Tagged With: DEALER, EXTENDED WARRANTY, MAINTENANCE, NEW CAR, REPAIRS, SERVICE CONTRACT, WARRANTY

Smart Car Leasing Options For Savvy Consumers

March 24, 2013 by admin 5 Comments

A light blue Volkswagen Beetle cabriolet is in your future or at least you hope it is if you can swing your car payments. Those monthly payments can, however, be reduced if you choose car leasing over traditional loan financing. For when you lease a car, your costs are lower than buying, with the difference here being that you return your leased car at the end of the lease term.

New car leasing also offers some options that you will want to keep in mind as you consider your Volkswagen or other vehicle acquisition. Be a savvy consumer and weigh these options when shopping for a new car.

Money Down

car leasingLike regular bank loan financing, you will need to bring some money with you when you negotiate your lease deal. Even if your deal includes no money down, there are other costs that must be added included dealer fees, registration expenses and taxes.

For starters, your down payment represents your car’s “capitalized cost reduction” or the money that you pay before you begin your lease. It is possible to get this cost rolled into your monthly payments, effectively raising your costs from month to month, while limiting your initial pay out.

Some consumers prefer to make their payments all at once. For example, if you have a 24-month car lease, you can make those payments ahead of time and be done with you financial obligation. This option allows you to operate from a position a strength, where you negotiate the best car deal possible, then make your payment.

Car Leasing Terms

Lease terms are typically for three years or 36 months, but it is possible to lease a car for as little as 12 months or as long as 48 months. Car leasing companies may prefer that you opt for a standard lease contract, but as the customer you can negotiate terms that are right for you.

Keep in mind that the longer your term, the lower your monthly payments. Also, consider that your new car warranty can run out before your lease is done. Therefore, align your lease term with the length of that warranty or be prepared to assume extra costs that can raid your wallet. You can also buy an extended warranty, with that cost rolled into your lease agreement.

Open or Closed

Not too common with consumer car leasing are so-called open-end car leases. Also known as an equity lease, under this arrangement you must purchase the car at the end of lease term. That predetermined amount must be covered in a one-time or balloon payment or you can seek additional financing to cover these costs. With this option, a three-year lease can turn into a four-year used car loan, making for seven long years of car payments.

Most consumers prefer closed-end leases and that is what car leasing companies generally offer. With a closed-end lease, your financial obligation ends when you return your vehicle at lease end. You may still need to pay additional charges for going over the mileage limit or for excess wear and tear, but your car payments end as the lease term comes to a close.

Gap Insurance

Always ask for gap insurance coverage when signing any lease deal. Gap or guaranteed asset protection ensures that if your Volkswagen or other car is totaled or stolen, you are not responsible for future lease payments or a lease deficiency. Never underestimate the importance of such coverage because if your leased car is written off as a total loss, there could be thousands of dollars of lease termination costs to cover. Gap insurance literally fills in the gap between your responsibilities and what the car leasing company says that you owe them, a worthwhile expense to be added to any lease agreement.

See Also — Automotive Leasing and Lending Continue Rise

Filed Under: Dealers Tagged With: BUDGET, CAR FINANCE, GAP INSURANCE, NEW CAR, VEHICLE LEASING, WARRANTY

Why Your Used Car Is Worth Less (And What You Can Do About It)

July 1, 2012 by admin Leave a Comment

Sell your car and still come out ahead.

2014 Toyota Corolla

If you’re planning to sell your car either to a private party or to trade it in to a dealer for a new car, then you may have discovered that its value has slipped in recent months. Besides being a few months older and with more miles on the odometer, there are some good reasons why your cars valuable has been slipping. Well tackle those issues here and help you get more for your car when you’re ready to make a sale.

1. Lower gas rates equals falling prices for economical cars. In recent years as gas prices have risen so has the value of fuel efficient small cars. Earlier this year, gas prices topped $4 per gallon across much of the nation, pulling up used car prices with it. As gas prices fall as they are doing in summer 2012, used car values are also falling. This is one area of car pricing you have little control over, but take heart if you own a luxury car as scant supplies of these vehicles has been driving up prices according to the National Automobile Dealers Association and its Used Car Guides.

2. Make mention of a warranty. Later model used cars often come with a new vehicle warranty, one that may not have expired yet. Check your warranty and if it is fully transferrable to a new owner, make note of that when you advertise your car for sale. Even older models from Kia and Hyundai may still be covered, given that both companies offer a 10-year/100,000-mile powertrain warranty. An available warranty adds values to a car.

3. Get it ready to show. You can make up for the dropping value of used cars, by ensuring that your vehicle is in tip-top shape and looks great. Any maintenance issues should be resolved before you put your vehicle on the market. You’ll also want to wash and wax it, detailing it by using an old toothbrush to lift crud from cracks, a soft brush on the wheels to remove brake dust and pay particular attention to hazed-out headlamps. Providing similar attention to the interior can make your car look great and fetch you more when you’re ready to sell it.

4. Sell it privately. It takes more work and preparation to sell a used car privately, but you stand to make much more money on a private sale than through a trade-in. Your car dealer may be willing to take your old car off of your hands, but that comes with a price reduced profits fro you. Dealers will sometimes inflate the price of your trade-in to make it look as if youre getting a good deal, but youll pay in some other way such as receiving less of a discount for your new car.

5 Advertise it effectively. These days, you don’t have to take out an expensive newspaper advertisement to market your car. Indeed, word of mouth advertising can help you sell your car, perhaps to someone you know. Start with the people nearest and dearest to you and tell them that your car is for sale. Ask them to help spread the word, providing contact information and car details on a flyer or through an email message to help your market your car. Beyond the people you know, online ads through services such as MSN Autos, AOL and Edmunds.com can also attract buyers according to Consumer Reports.

Private Sale

Ultimately, the value of your used car doesn’t always coincide with what a buyer may be willing to pay for it. A few percentage point drop in car values can be made up if your car is in good running condition, looks great and is a model that is in high demand. Negotiate wisely and you’ll come out ahead in a private party car sale.


See Also — 8 Reasons to Avoid a Particular Used Car

Filed Under: Special Tagged With: ADVERTISING, detailing, NADA, USED CARS, WARRANTY

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