Buying a new car involves making several decisions, some of which can be expensive. But just when you think you’ve picked the right make, model, color, and options and researched pricing, a prominent decision still remains: whether to buy an extended warranty or not. (Chrysler helped make the decision for its customers, unveiling a new 7-Year/70,000-Mile Limited Powertrain Warranty to motivate buyers to its dealerships.)Extended warranties are available for both new and sometimes late-model used vehicles. These policies’ value depends on numerous variables. We’ll briefly sort through some of the major concerns here News source: Autos AOL Beyond BasicAnyone who buys a new vehicle will likely be offered an extended warranty during the paperwork portion of the purchase process. Ideally, your new-car research should anticipate this so you’ll know 1) whether you want the warranty and 2) if so, the type of coverage and from whom.More Autos StoriesOther auto articlesfrom Automedia.com:2007 Toyota Camry Gas Saving Tips College and Auto Insurance Aftermarket Vs. OEM Warranties Extended warranties aren’t for everyone. First, consider how long you’ll likely own the vehicle. If you’re doing a 3-year lease, the regular manufacturer’s warranty will likely cover the major parts, so the extended warranty might be a waste of money. Similarly, if you get a new car every three to five years, balance the cost of an out-of-warranty repair against the price of the extended coverage.Which leads to the next topic: Research the reliability record of the vehicle you intend to purchase. For example, if the car has a history of transmission problems, then a single beyond-warranty major repair could exceed the cost of the extended coverage. On the other hand, models that have good reputations for enduring reliability might not need the extended coverage if they’ll be traded in on a new car shortly after their basic warranty period expires. Several web sites list recall and service-bulletin information to help assess a given model’s reliability.OEM or IndependentIf you plan to keep the new vehicle for a number of years and are seriously considering the peace of mind provided by an extended warranty, realize that the coverage doesn’t have to be purchased from the same dealer where you buy your car — or even at the same time you sign the papers. Remember, this coverage kicks in after the manufacturer’s warranty expires, so don’t feel pressured into buying something that you wouldn’t use for three or more years anyway. In fact, extended warranties can often be purchased within 24 months or 24,000 miles at no additional surcharge.Also, dealers set their own prices on everything, including extended warranties. Although the dealer might push an “aftermarket” warranty that’s underwritten by an independent company (because the dealership likely makes the highest commission on this policy), it should also offer a factory-backed warranty. If the dealership claims to have no knowledge of the automaker’s “extended service plan,” remember that the only advantage to buying the coverage at the same time as the car is that the price can be added into the financing. Another dealership will probably be happy to sell you the automaker’s extended coverage.New CarsPowered by Get multiple dealer quotes Select Make Select Model ZIP Generally, the factory-backed extended warranty has fewer restrictions than an aftermarket one. For example, the factory policy might allow service at any of its dealerships while the aftermarket one might stipulate that repairs can only be done at the dealership who sold you the car (or the extended-coverage policy). Also, the factory and its dealers already have business relationships that include reimbursement for warranty work. An aftermarket policy might require that the failure be inspected and approved before service can be authorized. Or, the customer might have to front the entire repair bill, then get reimbursed by the insurer (less the deductible) once it’s satisfied that the claim meets all of the policy’s criteria. Incidentally, independent insurers can be researched at A.M. Best and Standard & Poor’s. Companies that have less than an “A” rating often have inferior claims-resolution records. Internet research will also provide an idea of the cost of various extended-warranty policies.In a nutshell, an extended warranty shares many similar components with a car-insurance policy. Make sure to read all of the fine print. For example, deductibles might either be applied per visit or per repair. This means that if multiple problems are solved in one session, you pay the deductible only once under per-visit coverage; if air conditioning and the transmission are fixed during the same visit, you still pay two deductibles under a per-repair policy.Know what parts are covered and under what conditions. Competent home mechanics may want to save a few dollars by buying extended coverage for major powertrain components only and fixing any minor problems themselves. Extended-coverage policies might also address the circumstances under which the problem occurred. “Breakdown” failures might be covered but not problems that resulted from normal wear and tear. Some policies might also stipulate that manufacturer-recommended service intervals be documented for the claim to be honored. If this is the case, save all service records and even parts-store receipts if you decide to change your own oil or perform other routine maintenance yourself.But wait, there’s still more: For one, the terms of the policy might differ based on time and mileage. If you figuratively live in your car, opt for a policy that covers fewer months but more miles. Other features can include emergency towing, reimbursement for some costs if stranded away from home, transferability should you decide to sell the car and even partial or full reimbursement if you never use the coverage. In general, the better the coverage and lower the deductible, the more expensive the policy.So forewarned is forearmed, both when buying a new vehicle and an extended warranty. Just remember that everything is negotiable at a car dealership. If you want extended coverage and identify the policy that suits your projected needs, haggle the actual cost of the premium — don’t be smoke-and-mirrored by the “few extra bucks” it’ll add to the monthly payment. Also remember that the dealership is trying to make as much money as possible. Its first offer is seldom its best. As the consumer, you should ultimately control what best suits your needs.