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I am facing the same issues. I bought an 04 with 23K on it, and I have warranty until 9/07, then I have to decide about the extended warranty. I bought the car from a lady who's husband had died. Everything seemed fine, and probably still is, but I found out after buying it that the engine had been replaced at 9,500. I suppose I should be comforted to know that it has less miles on it than the odometer indicates.
My concern with the extended warranties is that they have to make a profit - and if they are regularly paying out more than they are charging - they won't be in business. So we know that if they charge $3,600 for 3 years, the average payout is somewhat south of that, and maybe significantly. There are going to be people who save a lot of money by buying the warranty, but the avergage guy will lose. It is simply peace of mind we're buying, and I'm not sure how much that's worth to me.
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