Paying off a car loan is a major financial win that can take a lot of weight off your shoulders. Once you own your vehicle outright, though, that doesn’t mean that you will never have to spend another penny on it. The reality is that paying off a new car most likely means that the factory bumper-to-bumper warranty has expired on your used car, and you will be financially responsible for any repairs that need to be made if your car experiences a mechanical breakdown.

While you might want to enjoy having no monthly payments for a while, an extended car warranty or auto protection plan will be well worth it in the long run and should generally start at around the 60,000-mile mark. Having an extended warranty on your paid-off vehicle will ensure that you can receive the financial assistance you need to cover repairs and keep your car running smoothly for many years to come.

Why the End of a Car Loan Isn’t the End of Car Costs

The final car payment is a major milestone for anyone, regardless of their financial situation. It can feel like crossing a finish line, and you may want to take a deep breath and soak it all in. One of the downsides of paying off a vehicle, though, is that the factory warranty from the automaker will be over by the time you make the final payment. Since most limited factory warranties are good for around five years or 60,000 miles, it will probably be finished just as you pay off your loan. This means that any problems that come up after that point will be your sole responsibility and will have to be paid out of pocket.

As the mileage on your vehicle’s odometer goes up, so does the likelihood that it will start to have more serious issues beyond normal wear and tear and routine maintenance. For the most part, cars start needing component replacements and repairs somewhere between five and ten years after being built. This is, unfortunately, right around when most people make the last payment on their car loans. Because of this, having an extended car warranty, which is more accurately called a vehicle service contract (VSC), is incredibly important.

Common Repairs That Hit Right After the Warranty Ends

​While it is impossible to say which parts of your vehicle are most likely to fail when your factory auto warranty is up, there are a few components that tend to fail or need repairs at around the same time. The transmission, for example, is likely to need some kind of repair around the 60,000- to 80,000-mile mark. A new transmission is one of the most expensive repairs and will cost between $5,787 and $6,297, making it essential to have extended coverage once your manufacturer’s warranty is over so you don’t get stuck with the repair bill after a mechanical breakdown.

​Electrical systems are also notorious for failing immediately after the factory coverage is up. After about 60,000 miles, vehicle electrical systems, which include components like modules, relays, and alternators, start to fail and will require fairly extensive repairs to get back up and running. With a vehicle service contract in place, you won’t have to worry about paying for large repairs right after making your last car loan payment.

​The Cost of Driving Without Coverage After 60,000-100,000 Miles

​After 60,000 miles, many vehicles start to have issues and need repairs or extra maintenance to keep them running smoothly. Even small replacements like serpentine belts or spark plugs can eventually add up, and you may find that you are still paying a lot of money for your vehicle on a yearly basis, even after it is paid off. Plus, common issues and replacements can add even more to those upkeep costs. A timing belt replacement, for example, costs between $$884 and $1,284. A fuel pump replacement or repair costs between $1,226 and $1,479. If any of these components fail, you may find that you end up paying much more than you ever did for your monthly car payments.

How Extended Warranties Can Help Keep Paid-Off Cars on the Road

Once your loan is paid and your factory warranty has run out, you are literally and figuratively on your own with your vehicle. While this can be freeing, it can also be financially stressful, and an extended warranty is a great way to alleviate some of that stress. While you can purchase extended coverage from the vehicle manufacturer, there will be limits to where you can get repairs done and the extra benefits that come with that coverage. A third-party provider, like Endurance Warranty Services, offers more flexibility for repairs, as well as the type of auto protection plan you have for your vehicle. If you want to rest easy once your vehicle is all yours, a protection plan will help give you the peace of mind you need.

Signs It’s the Right Time to Add an Extended Warranty Plan

It is never too late to add an extended warranty or vehicle protection plan to your car and get the kind of coverage you need to feel confident about unexpected repairs. Ideally, the best time to obtain extended coverage is as soon as your factory warranty expires. For many people, though, that won’t quite be necessary as they may not have that many miles on the odometer.

For most drivers, getting extended coverage at around 60,000 miles will be just about right. That tends to be when most major repairs start to come up, and when drivers may need a little bit of help paying for those car repairs. Knowing what issues your vehicle is known for and when you can expect them to start will help you make the right decision for your specific car and your personal financial situation.

Protect Your Car and Preserve Its Value With Endurance

When you pay off your vehicle, keeping it in good shape should be your top priority. With high-quality warranty coverage, you can get the protection you need and save money in the process. Endurance offers a wide range of auto protection plans and add-ons for vehicles and drivers of all kinds. Endurance Warranty covers vehicles that other extended warranty companies won’t, such as Canadian Gray Market cars, vehicles with a rebuilt or salvage title, and cars used for commercial purposes like delivery or rideshare.

In addition to covered repairs, Endurance customers also receive access to a range of extra perks designed to help keep them safe on the road. Things like 24/7 roadside assistance, rental car coverage, and travel interruption coverage make for a worry-free driving experience that anyone can enjoy. Plus, for a small activation fee, Endurance customers can also get a year of our Elite Benefits program, which includes tire repair or replacement, key fob replacement, windshield coverage, and more.*

If you are ready for top-of-the-line protection for your vehicle, get in touch with our plan advisors at (800) 253-8203 for a FREE quote. You can also see your price and plan recommendations through our online store.

For more auto expert resources, be sure to check out the Endurance Warranty blog. There, you will find DIY walkthroughs, repair shop tips, provider comparisons, and more.