On average, car repairs cost between $500 to $600. That’s a considerable sum that leaves many in debt each year. As a result, interested clients opt to either postpone or cancel an auto purchase for fear of not being able to pay their dues.
The good news is that a vehicle service contract can help shoulder the maintenance and repair expenses that most car owners experience. Educate your clients and make them understand its value once their limited warranty expires.
Understanding Vehicle Service Contracts
What is a vehicle service contract, and how can Vantage Financing help your dealership sell them?
A vehicle service contract is a paid plan that covers costs of specific auto repairs and replacements following the expiration of either the manufacturer’s or dealer’s warranty. The basic warranty often lasts for five years or after 60,000 mileage. Some buyers prefer to buy a service contract while the warranty is in force.
Not all services under warranty are covered in a service contract. It offers perks not covered before in the warranty.
To avoid duplications, check the coverage period to circumvent unnecessary spending. The cost of service contracts varies up to $1,000 and depends on:
- The model of the car
- The car’s manufacturer
- The vehicle’s age
- The contract period
- The coverage offered
The Benefits of Service Contracts
Is a vehicle service contract worth selling? A cost-benefit analysis will help assess the client’s financial position and support their decision to buy. In most cases, investing in a service contract from a manufacturer or third party is helpful to your dealership business and clients.
Car owners will benefit from the unforeseen repairs covered in service contracts. Exclusions include normal wear and tear, rental car expenses, maintenance (e.g., tune-ups), and common repairs (e.g., loose breaks). Reading a list of exclusions help car owners maximize savings and avoid the long claims process.
Third-party collaboration is common for auto dealers. If you aim for better service and wide-ranging financing options, this partnership is ideal. It can help establish authority and brand equity that can impact your sales.
Partnering with Vantage Financing for Your Vehicle Service Contract
Clients find third-party service contracts more affordable, reliable, and extensive. Independent companies have efficient systems as they are more focused on servicing clients with financial options than car sales.
Vantage Financing is an independent auto financing company that understands the variations of service contracts. Our company knows that car owners can overwhelm auto dealers with questions that are too technical.
For your convenience, we offer virtual services for its auto finance products, including service contracts. We can help educate your clients on the technicalities and their responsibilities and help them process their applications and fulfill their claims, giving you more time to focus on your other business.
To learn more about our services, contact us for more details.
