What Does Service Contract Issued Mean on Carfax

If you`re in the market for a used car, you`ve probably heard of Carfax, the online vehicle history report service that provides buyers with detailed information about a car`s past. One of the pieces of information that you may see on a Carfax report is “service contract issued.” But what exactly does that mean, and how does it affect the value and reliability of the car you`re considering?

A service contract, sometimes also called an extended warranty, is an agreement between the car owner and a third-party company that covers the cost of repairs and maintenance for a certain period of time or mileage. Service contracts are offered by a wide range of companies, including manufacturers, dealerships, and independent providers. They can provide peace of mind for car owners who want to protect themselves from unexpected repair costs, but they can also be expensive and may not always be necessary.

When “service contract issued” appears on a Carfax report, it means that the previous owner or dealership purchased a service contract for the car. This information can be useful for buyers because it indicates that the car was likely well-maintained and may still be covered by the service contract. However, it`s important to note that not all service contracts are created equal, and some may have limitations or exclusions that could affect the car`s value.

For example, some service contracts may only cover certain parts or systems, or may require the owner to use specific repair facilities. Additionally, some service contracts may only be valid for a certain period of time or mileage, and may not transfer to a new owner if the car is sold. It`s important to carefully review the terms and conditions of any service contract that comes with a used car to ensure that you understand what is covered and how to use the coverage if needed.

In general, a car with a service contract issued on its Carfax report may be a good choice for buyers who want extra protection and assurance that the car has been well-maintained. However, it`s important to carefully review the service contract and consider the overall condition and history of the car when making a purchase decision. A good Carfax report is just one piece of the puzzle when it comes to buying a reliable used car.

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