A $3,000 extended warranty sounds very different depending on where the money sits. Give it to the dealer, and it buys a contract with specific coverage, exclusions, deductibles, and claim rules. Keep it in a dedicated repair fund, and the entire $3,000 remains available for whatever the car actually needs.
That difference deserves attention before signing the finance paperwork. An extended warranty, more accurately called a vehicle service contract, can cover certain repairs after the factory warranty ends. But the Federal Trade Commission warns that coverage varies widely, and some contracts can overlap with existing warranty protection.
