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Beware of Vehicle Warranty Scams

Have you ever received a phone call from a company saying you must act now to renew your vehicle warranty? What about a letter that looks like it comes your car manufacturer or dealer, but the fine print indicates it is a third party warranty company? Emails and text messages also promote vehicle warranties from multiple companies that are not affiliated with your vehicle manufacturer or dealer.

Extended Vehicle Warranties: Scam or Legit

Are these vehicle warranty companies legitimate businesses, or are they a scam? The answer is: both. Most consumers are advised to steer clear of these extended vehicle warranty companies regardless of whether they are a true “business” or a complete scam.

Both scammers and many extended vehicle warranty companies use similar sales tactics. For example, the scammers and the warranty sales companies may both try to sound more official than they really are. They may have researched vehicle purchase histories, and they know the type of vehicle that you purchased. The scammers and vehicle warranty sales companies often impersonate someone else by acting like they are calling or writing from your dealership or the car manufacturer.

Most warranty companies and the scammers also use high pressure tactics like warning you about upcoming expiration deadlines or threating to close your file if you do not act soon. They also talk about the thousands of dollars that you could lose if your vehicle warranty expires. These are just lies to pressure you into making a poor decision. Another similarity, neither scammers nor some vehicle warranty sales companies seem to have much regard for the FTC or the DO NOT CALL list.

Are Extended Vehicle Warranties a Good Deal

Even though some vehicle warranty calls may be from a “legitimate” business rather than a total con artist, it is best for most consumers to play it safe. Just because something is a “legitimate” business, this does not mean that you should trust the company or that you would benefit from their product. Consumers may still receive calls from “legitimate” vehicle warranty companies for vehicles that they no longer own. Also, the chances of you benefitting from owning an extended vehicle warranty are limited. The policies are generally written to favor the extended warranty company, not the consumer. If you must purchase an extended vehicle warranty to sleep well at night, do thorough research on both the company and the policy before committing any money.

If you are contacted by a vehicle warranty company or scammer, then it is best to avoid giving them any personal information. Hang up quickly. Better yet, avoid answering the phone from anyone that you do not know. These are trained professionals who get rewarded when they get your personal information or take your hard-earned money.

Avoiding Vehicle Warranty Scams

The Federal Communications Commission has its own webpage warning consumers against auto warranty scams. The FCC website also provides links for how to file a complaint about a suspected scam. AARP found that 7 out of every 10 adults received a vehicle warranty scam call in the last 12 months. Using a scam blocking phone service can benefit everyone, and many of these services offer free trials or limited versions of their call blocking technology. Get a magnifying glass if you get mail from your dealer offering to sell you an extended warranty. Chances are good that the fine print will show another company disguising itself to act like a business that you trust. Emails and text messages are also common sources for vehicle warranty sales and scams.

Guide Change provides educational information to help consumers avoid being scammed. To learn more, visit our blog with additional scam examples. You can also email us to share your own vehicle warranty or scam story at


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