If you’re planning to sell your vehicle and it still has an active warranty, you might be wondering what happens to the balance of that cover. Can you get some of that money back? Does the warranty transfer to the new owner? And what should you tell the buyer? 

You are in luck, because we have all the answers right here. As ever, we are committed to keeping you informed of all the important parts of life that you won’t learn in a classroom . 

Without further ado, here is what South African car owners need to know about selling a car that’s still under warranty. 

First, What Is A Car Warranty? 

For those new to the topic, a warranty is a promise from the manufacturer or service provider (usually a dealership) that they will repair or replace certain parts of the vehicle if they fail due to manufacturing faults. Most new cars come with a factory warranty, and these days, even some pre-owned vehicles may include extended warranties added later by the dealer or buyer. 

It’s important to note that warranties are not to be confused with service or maintenance plans. Warranties focus on mechanical and electrical failures – not general upkeep.  

A great example to keep in mind is if your gearbox breaks due to wear and tear, your warranty won’t replace it. Now, if the breakdown was completely unexpected and due to a manufacturing fault, your warranty will pay for the replacement. 

Let’s Cut To The Answers 

Your first question might possibly be, “What happens to the warranty when I sell my car?” 

The answer depends on the type of warranty you have. 

A factory warranty usually transfers the warranty to the new owner automatically, just as long as the car is still within the warranty period and has a full service history. So that’s quite simple and hassle-free. 

Extended warranties, which are purchased separately, might be transferable, but it’s not as automatic. Some providers charge an admin fee or require paperwork from both the buyer and the seller. 

The last category is the third-party warranty. For the most part, these are non-transferable, meaning they end when you sell the car.  

You would need to check the terms and conditions of your specific warranty to confirm what applies before you make any commitments to potential buyers. 

Let’s Talk About Refunds 

So, what if you can’t or don’t want to transfer your active warranty? Could you get a refund? There’s no blanket yes or no to this question. If your warranty doesn’t transfer, you may be eligible for a partial refund – especially if you paid upfront for an extended warranty.  

Here’s how it typically works: 

• Request confirmation from the warranty provider that a refund is possible. 

• Submit a cancellation request and provide proof of sale, mileage, and other details. 

• A pro-rata refund will be calculated based on how much time or mileage remains. 

• Admin or cancellation fees may be deducted from your refund. 

Some providers only allow refunds if you cancel the policy within a certain timeframe, for instance, within 30 days. That’s why you should check the fine print early if you’re thinking of selling. 

What Was That About Service Or Maintenance Plans? 

As an added bonus, let’s touch on what it would mean for you to sell a vehicle with a service or maintenance plan. Because the reality is that including a valid plan in the sale can also be a strong selling point, since it reassures buyers that they won’t face sudden repair costs. 

Generally, these often work the same way. First you check if the plan is transferable and if so, then the new owner can continue using the plan until it expires. If it’s not transferable, yo may be able to get a partial refund if there’s still time left, and you cancel according to the plan’s terms and conditions. Lastly, you’ll need to notify the provider and share proof of sale. 

Key Tips When Selling A Car With An Active Warranty 

• Gather your paperwork: Have the warranty policy, service history, and proof of any additional plans ready. 

• Be honest: If the warranty can be transferred, let them know what’s covered and how to update the details. 

• Notify the warranty provider: Whether transferring or cancelling, they’ll need to know that the vehicle’s been sold. 

• Check for refund options: Even a partial payout on a cancelled plan is better than leaving money on the table. 

Feeling Informed? 

A valid active warranty or service plan can boost your car’s resale value – but only if you understand how it works. Whether it’s transferable or refundable, knowing your options helps you sell smarter and possibly pocket some cash along the way. 

We trust that this information will help you make an informed decision that best benefits you. All it takes is a bit of time on your weekend to check, and it will be time well spent.  

Don’t forget that in addition to useful tips and advice, you can also explore AA Inform and use our Free Vehicle Valuation Report tool. This report can tell you what the value of your vehicle is at trade and at retail value, and includes all the relevant information on your vehicle that you may not know, such as make, model, transmission type, engine size, and more. Very handy data for those who want to accurately advertise their vehicles.