Comments by "SeanBZA" (@SeanBZA) on "Rainman Ray's Repairs" channel.

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  4. Especially extended warranty on things like household goods and electronics. Here there is a statutory one year warranty on all new goods, and thus the warranty company knows that, in year one, where most factory defects will show up, they will use the factory claim process, and not actually have to cover anything. Then for say the common 2 year extended warranty they know there will be little claims, all of them invariably from the owner doing something wrong, or from the manufacturer doing a recall, and thus again no payout, or only part payout. Basically the extended warranty is almost useless, because it either will not cover all parts, or will not cover labour, or will have hoops that are near impossible to jump through to get it right. Knew a salesperson at one of these places, and half of his commission came from the selling of these, for the above reasons, they were a massive profit for the selling dealers. Cars the same, sold used with a limited warranty, and if there is a balance of factory that will do for a lot, so the extended warranty is there as a way to make profit, because the dealership gets the sales commission up front, after the new owner has paid 3 months of premiums, and then the owner is paying off this warranty at whatever interest rate for the full period. So whatever was down on paper as the amount of the extended warranty the buyer now pays at least double that over the life of the loan, and every month as well pays a "facilitation fee" of some sort, again a profit, for the extended warranty, plus a charge for taking the payments. If you have to loan to buy, but not the highest you can afford, and buy cheaper, and for as short a period as you can, and with as big a deposit as you can. That makes it easier to finish the loan, and have the car serviced, and keep it for as long as possible. Having a car loan for 7 years, on a vehicle already 5 years old, in say the rust belt, where the chances of the entire bottom rusting out before that 7 years are up, is very high.
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