TRACY (CBS13) – A collector of cars and motorcycles, Darrell Hare paid $85 a month for an extended warranty that would cover his Mercedes for 60,000 miles, giving him peace of mind.
The extended warranty was through a company called American Standard Auto Protection (A.S.A.P.). Part of the warranty deal was if Hare sold his car before 60,000 miles he could get a partial refund for the miles left on the car he didn’t use.
So when Hare traded in his Mercedes for a newer model, he reached out to A.S.A.P. to collect on the refund. But when Hare called the company, he says they blew him off.
“I followed the return policy, and nothing happened,” he said.
Hare says the company kept telling him to leave a message and they would call him back the next day, but he says they never did. When we called A.S.A.P. all we heard was an outgoing recording from the company saying, “We regret to inform you that the company is no longer able to take on new clients.”
We’ve learned A.S.A.P. has filed for bankruptcy.
Over the years, we’ve reported on other car warranty companies going belly up, so we turned to the Better Business Bureau (BBB) to see if these warranties are even worth it.
Danielle Hale with the BBB says, “It depends on the level of risk the consumers willing to take.”
She says warranties may cover pricey parts, but there’s a chance you may never need that warranty, or in this case, the company might be out of business when you go to use it or get a refund.
“It’s really unfortunate for consumers involved when that happens,” said Hale.
Hare feels like he was ripped off and says he might just steer clear of auto warranties in the future.
“I would have been better putting it in the bank, waiting for the car to break down,” he said.
If Hale wanted to pursue getting his money from the company, he would have to file a claim with the bankruptcy court, where he might only get pennies on the dollar for what he’s owed.
We’ve reported in the past when it comes to extended warranties for electronics, cars, and vacuums it’s best to self-insure.
If you just put that money you’d spend on a warranty in the bank and collect interest on it, it’s there if you need it. It’s better in your pocket than with a company that’s not there when you need them.