EXTENDED WARRANTY or is it a Worthless Service Contract?
Update from Ralph Bristol Morning News - BBB Middle Tennessee can be heard Fridays at 7:50am on the Ralph Bristol Nashville Morning News, WTN 99.7 (FM Radio)
Who hasn't received a postcard or letter with BOLDFACED statements, "Important, Dated Material Enclosed"
Thousands of Consumers in Middle TN report receiving notices stating their vehicle warranty is ready to expire even though their actual manufacturers warranty or extended warranty through General Motors or Toyota won't expire for another year.
Other consumers report receiving the same notice even though they don't own a vehicle.
Vehicle Service Contracts are sold to help consumers save money on auto repairs, but do they really?
BEWARE..don't be tricked by misleading solicitations and high pressure marketers into paying thousands of dollars for worthless auto service contracts.
HOW TO AVOID BUYING A WORTHLESS AUTO SERVICE CONTRACT:
The complexity and national scope of the Auto Service Contract Industry is revealed by a complaint filed with the BBB: A Tennessee consumer bought a contract from a Missouri seller, issued by a provider in North Carolina and administered by a company in Texas. A South Carolina company insured the contract, which was financed through an Illinois company.
- Know the name of the PROVIDER....the first and sometimes the only entity the consumer has contact with is the SELLER.
- There are five major entities involved in the Vehicle Service Contract process: The Seller, The Provider, The Administrator, The Insurer who backs the service contract, and the final participant is The Financing organization.
In 2010 Tennessee consumers filed 1,678 complaints about worthless Vehicle Service Contracts.
- Take a close look at the contract coverage before buying. What is covered and what conditions apply
- Signature purchase over the phone translates buying the unknown
- How will the repair shop be paid?
- does the repair shop bill the contract company direct?
- or must you pay the shop and then seek reimbursement.
- if its the later, this is a major cause of consumer complaint because of reimbursement delays or failure to reimburse.
Many consumers call Auto Service Contracts 'extended auto warranties' AND many of the sellers and providers have the word WARRANTY in their name; but the term is a misnomer. A warranty is a promise that is included in the purchase of an automobile or other product. A service contract is paid for separately and is usually not available from the manufacturer.
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The BBB of Middle Tennessee, Inc. was founded in 1961 as a non-profit Tennessee organization serving 38 counties in Middle Tennessee and 7 counties in Southern Kentucky. The first BBB was founded in 1912. Today, BBBs serve communities across the U.S. and Canada.
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