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Buying a car is a process that’s full of decisions, many of which can drastically alter your out-the-door price. Deciding whether to purchase add-ons simply adds to the stress of it all. Most car buyers are offered an “extended warranty,” but it’s a term that is too often used in a misleading way. What are extended car warranties, and when do you need one? Let’s dive into what extended warranty coverage entails, whether you need one, and how to choose the best option for your vehicle without breaking the bank.
What Is an Extended Warranty?
An extended warranty is a service contract that covers certain repairs or services after the original manufacturer’s warranty expires. However, the term is frequently used incorrectly to refer to vehicle service contracts (VSCs) sold by third parties.
A true extended warranty can only be provided by the vehicle’s manufacturer or dealer. Vehicle service contracts, on the other hand, are often sold by third-party companies and cover repairs in addition to the original warranty.
Both extended warranties and vehicle service contracts protect you from unforeseen repair expenses; the key difference is who sells you the plan – the car’s manufacturer or a third party.
Do I Need an Extended Car Warranty if I’m Buying a New or Used Car?
Whether you need an extended warranty depends on your personal risk tolerance and the reliability of the vehicle you are purchasing. Here are some factors to consider:
New Cars: New vehicles come with a manufacturer’s warranty that typically lasts for 3 to 5 years, with mileage limitations as well. Here’s an example from Toyota. It’s important to check the warranty term for the vehicle you’re considering buying. If you plan to keep the car beyond this period and want extra peace of mind, an extended warranty or VSC might be a good option.
Used Cars: For used cars, especially those without any remaining manufacturer’s warranty, an extended warranty can provide valuable protection against unexpected repair costs. However, it’s important to consider the vehicle’s reliability and your willingness to pay for potential repairs out of pocket. For used cars, you can often get a much lower rate for a vehicle service contract from a third party.Get your quote in seconds with CarEdge.
What Coverage Should an Extended Warranty Provide?
When evaluating an extended car warranty, consider the following coverage details. The same rings true for vehicle service contracts:
Duration and Mileage: Ensure the warranty covers an adequate period and mileage that suits your needs and driving habits.
Exclusions: Understand what is not covered, such as wear-and-tear items and regular maintenance.
Deductibles: Check the deductible amount and whether it applies per visit or per repair. A high deductible may change your mind about the value of the coverage.
Additional Benefits: Some warranties include extras like roadside assistance and rental car reimbursement.
Should I Buy an Extended Warranty at the Car Dealership, or Somewhere Else?
While car dealerships often offer extended warranties, they typically come with significant markups. Here are your options:
Dealership: Convenient but usually more expensive. Be sure to ask if the warranty is from the manufacturer or a third party, and get a warranty quote from CarEdge to compare rates and terms, no matter what!
Manufacturer: You can often buy an extended car warranty directly from the manufacturer, sometimes even after the original purchase. But is it a better deal? Compare terms, coverage, and exclusions, along with the price.
Third-Party Providers: Many third-party companies sell vehicle service contracts. While these can be cheaper, it’s crucial to research the provider’s reputation and read the contract carefully to understand what is covered and what is not. These extended warranty and VSC providers are A+ rated from the BBB.
The Takeaway: Consider Coverage Details and Risk tolerance
Understanding what an extended warranty is and whether you need one can help you make an informed decision when purchasing a vehicle. Remember to consider your risk tolerance, the reliability of the car, and the coverage details of the warranty (or vehicle service contract). By doing your due diligence, you can find the best option that provides peace of mind.
Tired of car shopping hassles? Let us handle it for you with our CarEdge Concierge service. Our experts will find the perfect vehicle, negotiate the best price, and take care of all the details, saving you time and money. Learn more about CarEdge Concierge, the #1 car buying service in America.
Buying a car is a big deal, and it’s normal to have a lot of questions. Whether you’re a first-time buyer or have been through the process before, knowing what to ask can make everything a lot smoother. Here are some common questions every car dealer should be prepared to answer, so you can feel confident and informed about your purchase. Remember, knowing the right questions to ask when buying a car can make all the difference. Knowledge is power when it comes to buying a car in 2024!
What is the Out-the-Door Price of the car?
Why it’s important: One of the most important questions to ask when buying a car is about the total price, commonly referred to as the ‘Out-the-Door Price’. Knowing the OTD price, including taxes, fees, and any add-ons, helps you understand the full financial commitment. A reputable dealer should provide a clear breakdown of these costs. Try our free Out-the-Door Price Calculator to get a feel for the numbers to expect.
How Long Has It Been On the Lot?
Why it’s important: First of all, knowing how long a specific VIN has been waiting for a buyer gives you an instant snapshot of the negotiability. The longer a car sits, the more car dealers are willing to cut you a deal. Dealerships finance their inventory, and these ‘floorplanning costs’ add up quickly in today’s high-interest environment.
👉 Unlock days on the lot, market supply data, and local price trends with CarEdge Insights, now including invoice prices!
What manufacturer or dealer incentives are available?
Why it’s important: Understanding the available APR offers, cash discounts and rebates, or lease specials can help you make an informed decision. Sometimes, the salesperson may not mention all offers unless you inquire. Asking about what incentives are available and when they expire is one of the essential questions to ask when buying a car.
Can I take the car for a test drive?
Why it’s important: A test drive allows you to experience the car’s performance, comfort, and features firsthand. A reputable dealer will always allow a test drive, giving you the chance to ensure the car meets your expectations. No test drive? No deal!
Why it’s important: Understanding the terms of the warranty is essential for knowing what is covered and for how long. Asking detailed questions about the warranty coverage, including any exclusions and the duration of the coverage, can help you make an informed decision.
It’s important to ask 1) who the extended warranty is managed by (for example AUL, Endurance, or one of the other companies), 2) the duration of the coverage (mileage and time period), 3) covered components (the details matter, feel free to ask for the contract), 4) the deductible amount if you file a claim, and 5) if roadside assistance is included.
Why it’s important: For used cars, a vehicle history report includes information about accidents, repairs, and previous ownership. This report is crucial for assessing the car’s condition and history, making it one of the key questions to ask when buying a used car.
If you’re shopping at a dealership, never pay for this report. It should be offered free of charge. If it’s not available, that’s a red flag! We’d advise you to look elsewhere, no matter how ‘perfect’ the car seemed.
Can I have the car inspected by an independent mechanic? (Used Cars)
Why it’s important: Having the car inspected by an independent mechanic is especially important for used cars. The industry term for this is a Pre-Purchase Inspection (learn more about PPIs here). This inspection can reveal any potential issues that may not be apparent during a test drive.
If the dealer shows any hesitation about letting you get the car inspected by an independent mechanic (ie one that’s NOT working at the dealership), there may be something they’re hiding. What good is a used car if you end up needing thousands of dollars in maintenance when you drive it home?
Skip the Dealership – There’s a Better Way to Buy
Navigating the car buying process can be overwhelming, but equipping yourself with these questions to ask when buying a car can help you feel more confident and informed. Understanding the OTD price, days on the lot, incentives, and other crucial details ensures you make a smart buying decision
Tired of car shopping hassles? Let us handle it for you with our CarEdge Concierge service. Our experts will find the perfect vehicle, negotiate the best price, and take care of all the details, saving you time and money. Learn more about CarEdge Concierge, the #1 car buying service in America.
When choosing the best cars for teen drivers, it’s crucial to find a balance of safety, reliability, and affordability. Here, we highlight the top used cars for teenagers, focusing on models that are 3-5 years old and excel in these areas. These cars are reliable, safe, and perfect for learning to drive. Let’s explore the top picks, including fuel-efficient hybrids, all-wheel drive crossovers, and the best EV for teen drivers, along with their 2024 prices.
Toyota Prius
CR Reliability Rating:77/100 Average Selling Price: $21,554
Why it’s great: 52 miles per gallon, 5-star crash test ratings, and excellent reliability scores from Consumer Reports… What more could you want from a first car? The Toyota Prius is a fantastic option for teen drivers, offering a budget-minded option that is sure to discourage the need for speed. The world-renowned Prius hybrid also comes equipped with a suite of safety features, like emergency braking with pedestrian detection and lane-keep assist. From 2019 onward, the Prius has even been available with all-wheel drive.
CR Reliability Rating:71/100 Average Selling Price: $19,604
Why it’s great: The Honda Civic has long been a favorite among drivers for its blend of reliability, efficiency, and sporty handling. It provides a confident driving experience powered by a turbo engine, while maintaining excellent fuel economy. The Civic is a great choice if your teen driver will be merging onto a freeway often. The Civic’s robust safety features and great crash test ratings make it a great choice for a teen driver.
CR Reliability Rating:87/100 Average Selling Price: $21,303
Why it’s great: It’s a legendary commuter car, but the Toyota Camry is also perfect for getting comfortable behind the wheel. With a Consumer Reports reliability rating of 87/100 for the 2021 Camry, it’s one of the most dependable used cars out there. Safety features like lane-departure warning, lane-keep assist, forward-collision warning and automated emergency braking come standard with the Camry. With a great reputation, resale values are strong should your teen driver need to upgrade years down the road. The Camry’s spacious interior, smooth ride, and famous reliability make it a great vehicle for new drivers.
CR Reliability Rating:80/100 Average Selling Price: $21,917
Why it’s great: If you prefer a SUV-like driving experience for your teen without sacrificing safety, a used Subaru Forester is a top choice. The Forester comes with standard all-wheel drive, safety features like automatic emergency braking, and excellent visibility of the road. Its high reliability ratings, attainable price, and strong resale value all strengthen the Forester’s reputation as a top pick for teen drivers.
CR Reliability Rating:87/100 Average Selling Price: $28,040
Why it’s great: For those looking for a touch of luxury, the Lexus UX offers a premium driving experience with the reliability that Lexus is known for. As the smallest model offered by the Toyota-owned luxury brand, it’s easier to command on the road than some of the larger offerings. The UX comes packed with advanced safety features like blind-spot monitoring and automatic emergency braking. As you’d expect from Lexus, the UX features a comfortable, high-quality interior with modern tech. While it’s on the pricier side, its blend of luxury and safety makes it a compelling choice for a teen driver.
CR Reliability Rating:78/100 Average Selling Price: $27,522
Why it’s great: EVs can be great for new drivers, but some are far better than others. Most parents and driving instructors would agree that it’s not smart to hand an EV with sports car capabilities to a teen driver, but not all electric vehicles are quite so fast. The Volkswagen ID.4 (2022 and onward) is a well-reviewed electric crossover with great range, good charging speeds, and 5-star safety ratings. The ID.4 even wins Top Safety Pick Plus honors from the IIHS.
What makes the ID.4 a better EV for teen drivers that say a Tesla? Simply put, the ID.4 drives more like a traditional car. It lacks the Corvette-like acceleration that you’ll find in a Model 3 or something similar, but will still merge onto a highway with ease. Think of the VW ID.4 as a safe, spacious and affordable no-frills EV for teen drivers.
Choosing a car for your teen driver involves balancing safety, reliability, and affordability. These crossovers and sedans are all excellent choices that meet these criteria. Whether you’re on the hunt for a simple crossover, a bit of luxury, or a good starter EV, these cars provide the most value for new drivers, especially teenagers.
Tired of car shopping hassles? Let us do it for you with our CarEdge Concierge service. Our experts can find the perfect vehicle for your needs, negotiate the best price, and handle all the details, saving you time and money. Learn more about CarEdge Concierge, the #1 car buying service in America.
While all new cars depreciate, choosing a model with a high resale value can significantly reduce your financial loss over time. Smart car buyers can minimize depreciation by selecting a vehicle with a high residual value, AKA resale value, should you ever decide to sell. Here are the top ten pickup trucks, SUVs, and luxury cars under $50,000 with the best resale value after five years. Don’t forget to check out the best resale values for new cars under $40,000.
1. Ford F-150
Starting MSRP: $38,960 for the base model (including destination fees) Average Selling Price in 2024: $59,864 5-Year Residual: 86.8%
Why it’s great: The 2024 Ford F-150 has been the best-selling pickup truck for most of the past few decades, and with good reason. Known for great towing capacity and too many trim configurations to count, there’s an F-150 for practically every budget. Its blend of capabilities and great resale value makes it a top contender in the full-size pickup market. Despite a starting price of just under $40,000, the vast majority of F-150s are more expensive, and for that reason we’ve featured it on this list.
Starting MSRP: $41,600 (including destination fees) Average Selling Price in 2024: $50,963 5-Year Residual: 85.0%
Why it’s great: The 2024 Toyota 4Runner is a durable, old-school SUV with a truck-style frame, ideal for rugged off-road adventures. Plus, it’s known for reliability that will last decades. It may not excel in fuel economy or modern tech, but its reliability and off-road capabilities appeal to a broad fanbase. In 2025, the 4Runner will receive the first big redesign in many years.
Starting MSRP: $38,345 (including destination fees) Average Selling Price in 2024: $61,278 5-Year Residual: 84.8%
Why it’s great: The 2024 GMC Sierra 1500 offers a blend of style and strength, sharing much of its mechanical prowess with the Chevy Silverado. Available in single cab, double cab, and crew cab configurations, it caters to various needs with bed lengths ranging from 5.8 to 8.2 feet. The Sierra’s diverse engine lineup and customizable body styles make it a flexible choice for both work and play. To top it of, it’s a truck with great resale value.
Starting MSRP: $41,235 (including destination fees) Average Selling Price in 2024: $51,507 5-Year Residual: 80.1%
Why it’s great: The Lexus IS stands out as a sporty compact sedan with luxury features. The IS offers a balanced blend of excitement and functionality. The entry-level IS300 is merely okay, but the IS350’s V-6 offers a better driving experience. Lexus is well-known for excellent reliability, and the IS joins the ranks of the luxury cars with the best resale value in 2024. On the downside, Lexus models are so popular that they can be tough to negotiate. Fear not, the CarEdge Concierge team can help with that.
Starting MSRP: $37,445 (including destination fees) Average Selling Price in 2024: $56,343 5-Year Residual: 80.0%
Why it’s great: The Chevrolet Silverado 1500 is a true workhorse. It boasts a variety of powertrain options, catering to diverse buyers. Known for its impressive towing capacity, the Silverado outperforms both the Ram 1500 and GMC Sierra 1500. The cabin features a massive touchscreen for modern convenience, though it prioritizes functionality over luxury. However, this truck isn’t cheap. You might as well ignore the official starting MSRP, as over 90% of Silverado 1500s sell for over $45,000. Fortunately, you can expect it to hold its value quite well over the years.
Starting MSRP: $33,890 (including destination fees) Average Selling Price in 2024: $59,929 5-Year Residual: 78.9%
Why it’s great: The 2024 Jeep Wrangler remains the quintessential off-road SUV, designed for adventure-loving drivers who crave rugged terrain. Its removable doors and roof, along with a fold-down windshield, allow for an open-air experience unmatched by any other SUV. The Wrangler isn’t cheap these days, with transaction prices more commonly north of $50,000. Fortunately, resale values are among the best in its class.
Starting MSRP: $41,145 (including destination fees) Average Selling Price in 2024: $44,850 5-Year Residual: 78.7%
Why it’s great: The Honda Ridgeline is the slowest-selling full-size truck on sale in 2024. Despite sluggish sales, the Ridgeline has a good resale value. If you’re looking for the best truck deals this month, the Ridgeline is commonly near the top of the list.
Starting MSRP: $38,455 (including destination fees) Average Selling Price in 2024: $49,924 5-Year Residual: 77.3%
Why it’s great: The 2024 Ford Explorer continues to be a leading choice in the midsize SUV market, offering a balanced blend of performance, comfort, and versatility. It comes with a range of engine options, including a turbocharged four-cylinder, a robust V-6, and a hybrid variant. The Explorer’s spacious three-row seating and ample cargo space make it ideal for families and road trips. Even with growing competition from Hyundai, Kia, and others, the Explorer remains an attractive option for those seeking a family SUV with strong resale value.
Starting MSRP: $40,375 (including destination fees) Average Selling Price in 2024: $49,709 5-Year Residual: 77.0%
Why it’s great: The 2024 BMW 2-Series offers a blend of performance and luxury in a compact package. Available as both a coupe and a convertible, the 2-Series boasts powerful engine options, including a turbocharged four-cylinder and an inline-six. Its sporty design, coupled with advanced safety features and a user-friendly infotainment system, makes the BMW 2-Series a compelling option for those seeking a luxury car with strong resale value.
Starting MSRP: $47,295 (including destination fees) Average Selling Price in 2024: $ 5-Year Residual: 76.1%
Why it’s great: The 2024 Audi A5 Sportback blends coupe-like styling with the practicality of a four-door, powered by Quattro all-wheel drive. The A5 Sportback offers up to 261 horsepower. Inside, luxury is the name of the game with leather seating, a panoramic sunroof, and ambient lighting. Its balanced performance, stylish design, and high-end features contribute to its high resale value.
Finding a car that holds its value well is a smart financial decision. The Ford F-150, Toyota 4Runner, Lexus IS, and other models listed here offer robust features, great driving experiences, and notably, high resale values. Looking for more DIY car buying tools? Check out CarEdge Insights for behind-the-scenes access!
Tired of car shopping hassles? Let us do it for you with our CarEdge Concierge service. Our experts can find the perfect vehicle for your needs, negotiate the best price, and handle all the details, saving you time and money. Learn more about CarEdge Concierge, the #1 car buying service in America.
New cars are depreciating assets, no matter how you look at it. However, smart car buyers can minimize depreciation by selecting a vehicle with a high residual value, AKA resale value, should you ever decide to sell. Here are the top ten cars under $40,000 with the best resale value after five years. Don’t forget to check out the best resale values for new cars under $30,000.
1. Nissan Frontier
Starting MSRP: $32,020 (including destination fees) Average Selling Price in 2024: $40,871 5-Year Residual: 88.6%
Why it’s great: The Nissan Frontier stands out in the midsize truck segment with 310-horsepower, responsive driving, build flexibility, and unmatched resale value. The Frontier comes standard with a 5.0-foot bed, and for those needing more cargo space, there’s an optional 6.0-foot bed—something the competition doesn’t offer. Although it doesn’t tow as much as the Toyota Tacoma, the Frontier compensates with a lower cost and the best resale value among midsize trucks.
Starting MSRP: $32,995 (including destination fees) Average Selling Price in 2024: $46,407 5-Year Residual: 88.0%
Why it’s great: The Toyota Tacoma is praised by nearly everyone who drives it for its exceptional durability and practicality. In 2024, the Tacoma remains a standout in the midsize truck market, offering an updated exterior and a greatly modernized interior. The new design enhances both its rugged appeal and comfort, which can be tough to balance. One of the most significant updates for 2024 is the availability of a hybrid powertrain, providing better fuel efficiency without sacrificing performance. Compared to larger truck competitors, the Tacoma is more likely to be found closer to the $40,000 price point. The Tacoma is one of the trucks that has the best resale value, year after year.
Starting MSRP: $38,485 (including destination fees) Average Selling Price in 2024: $49,221 5-Year Residual: 86.0%
Why it’s great: The 2024 Honda Pilot is a top choice for families, thanks to its spacious three-row cabin. In a market crowded with mid-size SUVs, the Pilot distinguishes itself with practicality and versatility. Under the hood, the Pilot features a robust 285-horsepower V-6 engine paired with a smooth 10-speed automatic transmission. While front-wheel drive is standard, all-wheel drive is available for those who need it. For adventurous families, the Pilot offers the TrailSport model, which includes higher ground clearance, all-terrain tires, and even skid plates. With a 5-year residual value of 86.0%, the Honda Pilot has one of the best resale values of any SUV today.
Starting MSRP: $30,170 (including destination fees) Average Selling Price in 2024: $34,745 5-Year Residual: 85.8%
Why it’s great: The Mazda MX-5 Miata is cherished as the most affordable true sports car, delivering an exhilarating driving experience without a hefty price tag. Under the hood, it boasts a 181-horsepower 2.0-liter four-cylinder engine, providing ample power to make every drive a thrill. Known for its lightweight construction and superb handling, the Miata offers a responsive and engaging ride that appeals to enthusiasts on a budget. With such a high resale value, the Mazda Miata is a good choice for sports car lovers who prefer to upgrade to the latest and greatest.
Starting MSRP: $37,595 (including destination fees) Average Selling Price in 2024: $48,760 5-Year Residual: 85.3%
Why it’s great: The GMC Canyon combines power and capability in a mid-size package. Under the hood, the Canyon features a robust 310-horsepower turbocharged four-cylinder engine paired with an eight-speed automatic transmission, which lends to a segment-leading towing capacity of 7,700 pounds. Its excellent resale value further enhances its appeal.
Starting MSRP: $31,095 (including destination fees) Average Selling Price in 2024: $42,112 5-Year Residual: 84.0%
Why it’s great: Chevrolet’s companion to the Canyon, the mid-sized Colorado, is a well-equipped truck with a great resale value. Powered by a turbocharged 2.7-liter engine, the Colorado is suitably powered for most tasks. The Colorado features a four-door cab with a five-foot bed and can be equipped with either rear- or four-wheel drive. With a maximum towing capacity of up to 7,700 pounds, the Colorado is one of the most capable trucks in its class.
Starting MSRP: $39,635 (including destination fees) Average Selling Price in 2024: $45,395 5-Year Residual: 83.6%
Why it’s great: The eight-seater Odyssey showcases Honda’s commitment to family haulers with a quick V-6 engine, a refined ride, solid handling, and more room than 99% of families even need. The Odyssey’s innovative Magic Slide seat system allows for versatile second-row seat configurations. The third-row seats can be stowed into the floor to expand cargo capacity. While it may not have as many high-tech features as rivals, it beats them outright as the van with the best resale value in 2024.
Starting MSRP: $30,240 (including destination fees) Average Selling Price in 2024: $39,573 5-Year Residual: 83.2%
Why it’s great: The Subaru Outback combines the best of both worlds with its SUV-like styling and car-like ride, making it a versatile choice for a variety of driving needs. Every Outback comes with all-wheel drive, ensuring excellent traction and stability in various driving conditions. While the cabin provides decent comfort and functionality, it stops short of luxury, focusing instead on practicality and durability. The Subaru Outback’s combination of versatility and reliability makes it a standout choice for those seeking an all-weather car with excellent retail value.
Starting MSRP: $30,850 (including destination fees) Average Selling Price in 2024: $37,286 5-Year Residual: 83.0%
Why it’s great: The Honda CR-V is a perennial favorite in the compact SUV segment, known for its reliability and affordable pricing. The CR-V’s spacious interior and cargo capacity make it an ideal choice for families looking for a no-frills crossover. On the downside, the CR-V is so popular that it can be tough to negotiate. Fear not, the CarEdge Concierge team can help with that.
Starting MSRP: $30,720 (including destination fees) Average Selling Price in 2024: $34,141 5-Year Residual: 82.7%
Why it’s great: Although newer competitors have emerged, the CX-5 continues to impress with its superb handling and refined interior. Under the hood, the CX-5 features a 187-horsepower with standard all-wheel drive. For those seeking more power, the optional 256-horsepower turbocharged 2.5-liter engine is the way to go. While the CX-5 sacrifices some cargo space for its stylish design, the cabin exudes luxury and comfort, making it a pleasure to drive and ride in. Despite its age (7 years on the market), the CX-5 continues to impress and attract more fans. With a 5-year residual value of 82.7%, you can stress less should you need to upgrade from this workhorse in the future.
Finding a car that holds its value well is a smart financial decision. The Nissan Frontier, Toyota Tacoma, Honda Pilot, and other models listed here offer robust features, great driving experiences, and notably, the best resale values. Looking for more DIY car buying tools? Check out CarEdge Insights for behind-the-scenes access!
Tired of car shopping hassles? Let us do it for you with our CarEdge Concierge service. Our experts can find the perfect vehicle for your needs, negotiate the best price, and handle all the details, saving you time and money. Learn more about CarEdge Concierge, the #1 car buying service in America.
