Auto-Service Contract Companies

Staff Writer for myfox8.com

February 20, 2011

 

WINSTON-SALEM, N.C. (WGHP) —

Auto-service contract companies promise to keep car repair bills from wiping out your bank account by selling an "extended warranty" for your car, but watch out for some.

Michael Tyree of Winston-Salem owns a 2002 Jaguar X Type, which comes with a big repair bill if something goes wrong.

When Michael got a call at home from stoprepairbills.com, he was naturally intrigued by a coverage plan that promised to take care of anything that could go wrong with his car.

Michael made a down payment of $139 and kept making monthly payments to the company. Eventually, he had spent more than $1,000.

However, when the time came for him to submit four claims over a six-month period, each one was denied.

The Better Business Bureau has received more than 600 complaints against the website, most complaining of similar incidents.

"It sounds like a great deal, but what folks have been finding out when they get this coverage is that it's not bumper to bumper or total coverage," Kevin Hinterberger with the Better Business Bureau said.

A lot of customers reportedly didn't read the contract before purchasing the coverage.

Stoprepairbills.com says it's a "responsible company that tackles every single complaint that comes its way in a timely manner."

They're not the only company of its kind getting complaints. The NC Attorney General has banned some companies from doing business here, such as Automotive Protection, U.S. Fidelis and Credexx.

With so many used cars out on the roads today, a lot of people are interested in extended warranties.

Those people should visit their local manufacturer's dealership. Drivers can always buy an extended warranty from the dealership, no matter where the car was purchased.

"When you purchase an extended warranty from us, it lays out everything that's covered and everything that's not covered that you purchased from us," Kerry Mitchael with Modern Toyota in Winston-Salem said.

Mitchell says it makes a big difference when you do business with someone you know. They have a reputation to protect so they use warranty companies they trust.

"We know what's going to be covered and we understand the warranty company we deal with and how they do business," Mitchell said.

The Attorney General's office says some less-reputable companies often pretend they represent the car manufacturer or your dealer.

If you'd like to file a complaint, visit the Attorney General's website.

If you'd like to check out an auto-service contract company, visit the Better Business Bureau's website.

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