Written by: Trevor Mahoney
Last updated: December 26, 2024
Adding an extended warranty to your vehicle can be an excellent decision that gives you protection and peace of mind while on the road. By covering the costs of certain breakdowns when they occur, a warranty on a new car or used car can help keep money in your wallet. However, if you are deciding to sell your vehicle, for whatever reason, you may be worried about your extended warranty being a lost investment.
Depending on the type of car warranty you purchased, you can transfer the warranty to the new owner. This can provide you with more negotiating power during the sales process and a slew of other benefits. Learn everything you need to know about transferring your vehicle warranty to a new party so that you don’t miss out on this opportunity.
Transferring Your Car Warranty: Key Steps to Follow
Assuming you are still within your warranty period and have a prospective buyer for your vehicle, learning the five steps to transferring your car warranty can offer many benefits:
Step 1: Review Your Warranty
The first step in transferring your car warranty is to review the terms of your warranty contract to see if you are eligible to do so. First, see if your warranty is a manufacturer warranty or an extended warranty to determine who to call—the dealership or your third-party provider. Provide them with your car’s VIN number and see how much time is left in your service plan to determine whether it’s even worth transferring.
Step 2: Inquire as to Your Plans Transferability
Once you have been informed how much time is left on your warranty plan, inquire as to whether or not your warranty package is transferable to a new owner. Assuming you are allowed to transfer the plan, gather all copies of your warranty contract and any applicable documents. While on the phone, go ahead and give the basic contact information of who the new owner will be so that they can stay in the loop on the process. During this stage, it’s also a best practice to ask about any transfer fees that your provider may charge; fees can vary, but it’s not unusual to see them as high as $100.
Step 3: Prepare for Transfer
Work with the buyer of your vehicle along with your warranty provider to prepare your vehicle for transfer. This may include filling out certain forms detailing information on the vehicle, exchanging more information with the buyer and the warranty provider, gathering various identification or vehicular documents, and more.
Step 4: Complete the Transfer Process
Once all documents have been gathered and the car is prepared for a warranty transfer, your provider will give you instructions on their procedures for transferring the warranty. Submit any requested forms they may ask for and pay any fees that may be required at this time. Whether or not the buyer wants to cover those fees is between you and them.
Step 5: Confirm Transfer
Finally, request written confirmation from your former warranty provider showing that the warranty is now in the name of the new owner of your vehicle. If the buyer has not yet been informed of the successful transfer, now is the time to get them back in the loop and show them the proof of transfer.
Benefits of Offering a Transferable Warranty
Far too many warranty contract holders choose not to go through the transfer process because they deem it too frustrating to handle, especially if the warranty period only has a somewhat short period of time remaining. However, there are three main benefits to going through the warranty transfer process:
- Increased resale value: Having a transferable warranty is an additional selling point for your vehicle, which means you can price your car higher than you otherwise would be able to due to the protection against mechanical breakdowns.
- Peace of mind for the buyer: A warranty, especially a new car warranty, provides reassurance and protection for the new owner. Having the ability to get covered repairs taken care of makes car owners feel more comfortable on the road and they may even be willing to pay a higher price or jump on a car offer quicker as a result.
- Streamlined sales process: A transferable warranty can simplify the negotiation and closing process.
Be aware that while transferring a car warranty to the new owner can be a simple process, there will still be challenges. Warranty providers may set eligibility criteria that the new owner will need to pass and the warranty company will require documents from both parties which may be a headache to gather. Overall, though, the benefits to having warranty coverage usually outweigh the upfront downsides.
Find a Car Warranty That Gives You Transfer Rights
Transferring your extended warranty to a new vehicle owner is a relatively simple process so long as the warranty you have gives you transfer rights. Before signing up for a warranty, whether it be an extended or factory warranty, check the conditions to transfer along with any fees or stipulations you may need to be aware of. If you don’t know where to start on your extended warranty search, don’t hesitate to start here by reviewing our list of accredited providers who can provide you with warranties ranging from high-level stated coverage all the way to bumper-to-bumper coverage.
