Auto Warranty Scams and How to Avoid Them
“We’ve been trying to reach you about your vehicle’s extended warranty.”
Is your blood pressure spiking yet? There’s a good reason that these annoying calls cause a very real, and sometimes very negative response. They’re annoying and most of them are from scammers, trying to get ahold of personal information. The calls are so common these days that even legitimate warranty companies can cause a rise in blood pressure when they call.
As it turns out, it is quite easy to avoid being scammed. You just need to recognize that giving out information over the phone is a big no-no unless you’re absolutely sure of who is on the other end of the line. Let’s take a look at what car warranty scams are, and how you can help protect yourself against them.
Common Auto Warranty Scams
Seeking out and purchasing an extended warranty for your vehicle is one thing, but being called and harassed into buying one over the phone is completely different. You’ve almost certainly gotten the robocalls, stating “we’ve been trying to reach you about your car’s warranty,” which are almost always bad news. Scammers love to use fear and “Final Notices” to pressure you into buying a warranty that is nowhere near the coverage you think you’re actually going to get.
In some cases, the scammers use a pre-recorded voice to trick you into saying yes or to record your voice as a “confirmation” that you want to buy services from them. Once you’ve handed over your credit card and personal information, the scammers will frequently sell and distribute your data to anyone willing to pay for it.
You can also be “scammed” through the mail. For example, Car Talk’s Editor-in-Chief Craig Fitzgerald got a frantic call from his then 89-year-old mother about an official document from the “Department of Automobile Records” with an “invoice” for $1,500 worth of repairs on a leased Volkswagen that had just 6,500 miles on the odometer.
This scary, official-looking document was a sales pitch from a company called “Interstate National Dealer Services,” which doesn’t even sell products to consumers. It sells directly to dealerships, which then sell to consumers. But it is the guarantor of products sold by Endurance.
Between 2017 and 2018, Endurance was getting HAMMERED with complaints about this deceptive means of getting consumers to pick up the phone, where waiting sales reps were ready to sell products to concerned car owners.
In this case, it’s not exactly a “scam,” because this piece of mail wasn’t trying to steal credit card data, but it certainly presented itself as some kind of official document, and none other than the FCC calls that a “scam.”
DO NOT, warns the FCC, provide any credit card numbers, social security numbers, bank routing numbers or any other type of financial information if you’ve been pitched over the phone or in the mail. In the best case, you may have purchased something you don’t need. In this case, all of the supposed “repairs” on the “invoice” would’ve been covered by the leased, 6,500-mile car’s original factory warranty.
At worst, though, you could be providing credit card information to what the FCC calls a “criminal.”
“Criminals may engage in caller ID ‘spoofing’ – deliberately falsifying the information transmitted to your Caller ID display to disguise their identity,” reads the FCC’s website.
To be fair, Endurance seems to have cleaned up its act since 2018, and no longer seems to engage in these practices, settling instead for constant television ads.
How to Know If You Were Scammed?
Is your warranty actually about to expire? Did the person calling you have actual knowledge of your vehicle and its service records? Do you still own the car they’re referencing? Do you even own a car at all?
If you have doubts about those things and have already given your credit card information, you’ve likely been scammed. You’ll also know how legitimate your warranty coverage is when heading in for service. If your local shop can’t bill or can’t reach your warranty provider, it’s time to cut your losses and start trying to block further issues.
What to Do If You Were Scammed?
The bad news here is that you’re unlikely to get a refund from the scammer, but your credit card company may offer some help. If you think you’ve been the victim of a scam, take stock of the information you’ve provided. Did you give your social security number or other personal information beyond just a credit card number? If so, you’ll need to freeze your credit and keep a close watch on your credit reports. Contact your credit card provider or bank to stop further charges to your card, and discuss options for recovering money that has already been lost to the scam.
How to Avoid Being Scammed?
First and foremost, don’t engage with people or “companies” that you’re not familiar with, and never answer questions or give out personal information unless you’re absolutely sure of who’s on the other end of the line. In general, it’s best to treat every bit of your personal information as being just as important as your social security number and birthdate. Even your phone number, in the wrong hands, can cause big problems.
Is an Extended Car Warranty Worth It?
Extended warranties can be worth it, as long as you plan on keeping your vehicle for an extended period of time. An extended warranty can help prevent the sometimes devastating costs of repairs as vehicles age, but you’ll need to do your research to find the right company and warranty coverage for you.
Which Car Warranty Companies Are Legit?
CarTalk’s research shows that there are several legitimate companies offering extended warranties. Endurance, Carchex, Toco, autopom! and others offer several warranties that range from basic coverage to complex, near-comprehensive coverage options. Even the most legitimate warranty companies have their shortcomings, however, so you’ll need to do your own research to determine which ones offer the best coverage for your vehicle. High-mileage vehicles, classic cars, and collectors’ vehicles can all be covered by an extended warranty, but the details of plans for those kinds of vehicles can differ wildly from company to company.
CARCHEX is one of the largest, most highly-rated providers of vehicle extended warranties in the market. They have been a trusted name in the business for 20 years.
autopom! is well known in the industry for customer service and responsiveness. The company works directly with 2600 certified repair facilities and has a dedicated customer advocacy program.
Endurance Extended Car Warranty company is one of the most popular and trusted providers in the business. Endurance coverage is accepted at any dealership and at any ASE-certified mechanic, and features a 30-day money back guarantee.
