My daughter recently (6 months ago) bought a new car. A fast-talking, obnoxous credit manager talked her into some long term extended warranty crap, which increased her monthly payment by about $40 over 6 years. How should she proceed to cancel the extended warranty? Should she contact the creditor first, and ask them to cancel the warranty/bring down her payment? Or will she have to refinance her existing loan?
A refi may not help since it is already in the balance. But, see if the warranty is refundable. A lot of the warranty will give you your money back for the un-used portion.
It may come down to a question of unconscionability or misrepresentation but, contact the warranty provider first.
Even if you are able to cancel the warranty, I do not believe her payments would change, as this is a closed-end, fixed payment contract.
jlyn is correct, if the warranty was financed with the vehicle purchase, the loan is a completed transaction. Your daughter may be able to get out of the warranty, and perhaps get some type of refund. Then she would have to apply that refund to the loan as a principal payment. Hpwever, this principal payment would not change the monthly loan amount, it would only shorten the loan time.
