What You Can Do
- Do your homework. Research which products perform well over time and which ones notoriously break down or malfunction. Ask friends, read the product literature, and consult consumer watchdog Web sites or publications that give information salespeople might forget to mention.
- If buying a used kitchen appliance on which the warranty or service contract hasn't expired, you need to verify that those agreements are transferable by calling the manufacturer or store where the item was originally purchased.
- While most warranties are effective from the date of purchase, others take effect at installation. Whatever the case, be sure you keep the sales receipt and paperwork together for verification. File these items in a homes-related binder, and place nearby for reference when you need to call a repairman.
Read the Fine Print
We live in an era when products such as kitchen appliances can do more in less time. Still, the perfect refrigerator or oven has yet to be created. Until then, it's reassuring that most manufacturers provide agreements that cover replacement parts or repairs. These legally binding documents, called warranties, are almost always based on a timeframe and not how long a product has been used. Also, most warranties don't cover misuse or faulty installation.
The following list further explains these general types of agreements.
- Limited or partial warranties: Typically, these stipulations guarantee new parts--but not the labor--to replace defective ones. Moreover, parts are usually supplied at no charge, provided they are installed by a service center that's been authorized by the manufacturer.
- Full warranties: These purchase agreements promise that a faulty appliance will either be repaired or replaced free of charge during a specific period of time, usually beginning with the date of purchase. If repairs are necessary, these contracts specify that the company or manufacturer must perform the work not only within a reasonable amount of time but also in a repair shop that is convenient to the customer.
- Extended warranties: Many manufacturers offer customers the chance to buy a service agreement extension shortly before the original term expires. Also, stores or distributors sometimes provide special deals that will automatically lengthen the life of a warranty, such as buying an appliance with a particular credit card. Generally, by extending a purchase agreement, the same conditions and limitations are updated but still apply.
- Service contracts: Unlike a full or limited warranty, which usually comes with a purchase, a service contract costs extra and acts as an insurance policy of sorts. It picks up where warranties leave off, providing a type of repair coverage. Still, these contracts usually contain clauses that exclude unconditional repairs. To keep from voiding the contract, you must precisely follow the agreement concerning the recommended repair centers.
To Buy or Not to Buy
Determining whether a service contract or warranty extension is necessary is like predicting the future. Because these options are a personal decision, there is no hard-and-fast rule. It is important that you don't spend more than 10% to 15% of the item's sale price. You can reasonably protect yourself by purchasing a national brand from a reputable dealer. Likewise, if you're deciding between buying a major appliance from a big-name retailer or a local dealer, consider paying a little more for the local guy. By making a one-on-one transaction with someone nearby, you will be building a business relationship that may prove invaluable if problems occur down the road.