Warning on warranties: Read the fine print

July 22, 2010 9:54:05 PM PDT
A local man has a warning for you about car warranties. And that is to read the fine print or you could end up paying the price. The 2003 Volkswagon Jetta is a big deal to a 17-year-old from Spring. It's his first set of wheels, but it's out of commission and sitting at the repair shop, and the warranty company refuses to pay for the repairs.

"It's definitely a lesson learned," said Mike Freeman, the teen's dad.

That lesson for Freeman is the wording on the back of a car warranty contract. If it's not followed closely, it will leave you holding a big repair bill.

The black Jetta was purchased in April. Freeman opted for the $500 warranty offered at the used dealership. Two months later, the transmission started slipping, so he took it to a general mechanics shop.

"They took a look at it. They didn't feel comfortable fixing it because it was an overhaul type situation," said Freeman. "So they asked us to go to A Plus Transmission."

He and his son picked it up, drove it home and the next morning, dropped it off at a transmission shop. The trip was about 30 miles, but because he didn't have it towed, Diamond Warranty Corporation says the contract is void.

"The vehicle wasn't towed," said Brian Moritz with Diamond Warranty Corporation. "His son definitely failed to protect the vehicle by continuing to drive the vehicle to another repair facility when he does have a free roadside assistance program to get the vehicle towed from shop to shop."

The Better Business Bureau says small company warranties can be riskier than more well-known brands.

"A manufacturer's warranty, whether you buy it on a new car or a used car, is always gonna have the stronger set of teeth because it's being backed by a huge factory that I'm just put it in blunt terms -- cares about its reputation," said Dan Parsons with the Better Business Bureau.

Freeman just hopes that anyone shopping for a used car right now realizes warranties come with caveats.

"I think that was their escape out of it and maybe I blame myself a little bit for not reading the fine print on the back," said Freeman. "I didn't see it and that's all honesty. I didn't see it. However, there was not malicious intent to drive the vehicle."

The transmission rebuild was $4,000, which Freeman paid for out of pocket. However, the used car dealership where he purchased the vehicle refunded him his $500 for the voided warranty.


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