Consumer Protection WA recently issued a media statement encouraging consumers to shop around for motor vehicle finance, and to take care before agreeing to buy ‘extras’ or ‘add-ons’ offered by motor vehicle dealers. You can read the entire statement here.

The media statement followed a rise in complaints about these issues to Consumer Protection.

The ‘extras’ or ‘add-ons’ can include extended warranties, rust proofing, paint and fabric protection and window tinting. Consumer Protection noted that consumers may not know the normal price for these items, and when a dealer offers them, the consumer may feel that they have little option but to buy them at the time.

Source: www.moneysmart.gov.au

These extras add up, and can leave consumers with a bigger debt than they intended. Shopping around can also allow consumers to get a better deal. In some cases, the cost of the ‘extras’ is added to the price of the vehicle, which can add to the financing costs and stamp duty paid on the total cost.

Additionally, the conditions that attach to some extended warranties can come as a surprise. Some warranties require vehicles to be serviced at the seller’s premises, leaving the buyer without the choice of servicing the vehicle elsewhere at a cheaper price, and where missing a service can void the warranty.

Consumer Credit Legal Service (WA) Inc. regularly receives requests for advice from consumers who are unhappy with the terms of their extended warranties. Unfortunately, many consumers have agreed to the terms of those warranties and will be bound by them, even if they later turn out to be a bad deal.

CCLSWA welcomes Consumer Protection’s media statement. We would also encourage consumers to shop around for the best interest rate for car loans, and to think carefully about the value of the add-ons on offer, including extended warranties. Consumers should always carefully consider whether these products are truly needed, what value they add to the vehicle, and if better value alternatives are available elsewhere.

If you have purchased an add-on product when purchasing a car, you can call the CCLSWA telephone advice line on 9221 7066.

For more information:

General information about buying cars is available on the Consumer Protection website www.commerce.wa.gov.au/motorvehicles  and enquiries can be made by email consumer@commerce.wa.gov.au or by calling 1300 30 40 54.

Consumers may also wish to view the ASIC Money Smart website on Car Loans: https://www.moneysmart.gov.au/borrowing-and-credit/car-loans