While we, as consumers, know we should do our homework before making any major purchase, sometimes we slack a little.
CNBC has a consumer alert/buyer beware story about extended auto warranties on its site, informing consumers that these warranties may be a rip-off and may not cover what they say they will cover.
NBC News investigated US Fidelis, a company that offers third-party extended car warranties, and found that this company is misleading its customers, leading them to believe US Fidelis is associated with the manufacturer. The investigation also found that more than 1,100 customers have filed a formal complaint with the BBB for things like not covering a repair that it said it would cover, leaving the driver on the hook for the repair bill.
In the video below, NBC News interviews US Fidelis’ CEO, who says the company is honest, and former employees, who claim they were trained to lie to customers to sell the warranties.
Experts say that the only time you should purchase one of these third-party extended warranties is if your car is past the manufacturer’s warranty, unreliable and expensive to repair. And if you do decide to buy one, the experts say to read all the fine print, because they usually only cover your car’s moving parts (i.e. engine or transmission parts), not things like air conditioning or electronic problems.
Click the video below to see the entire clip, which gives consumers good tips on things to look for when considering whether or not to purchase an extended warranty.