3 On Your Side

Phoenix woman says extended warranty company pocketed her money

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(Source: 3TV) (Source: 3TV)

When it comes to cars, Pamela Zydek says she'll only drive one kind -- a sports car.  She says it's been that way since high school.  

"Oh yeah, I've had I-ROCs, Firebirds, Trans-Ams, Corvettes, and Vipers," Zydek said.

Her current car is a sleek 2014 Corvette that she just recently purchased.  Although it's nice, she says nothing beats the car she just sold.  

"This is the car," Zydek said, showing us pictures on her cell phone. "I love this car.  It's a 2013 Grand Sport."

Zydek said she has lots of pictures so she won't soon forget the car.

Although she only drove it for a year before selling it, there was one thing the car had that gave her a little peace of mind.  It was an extended warranty that she had purchased for it.  

"I had a total peace of mind, thinking, you know, these cars are expensive to repair.  So, I felt better with the car, thinking if anything happened, I'll be covered with their warranty," she explained.

Zydek purchased the extended warranty online from a company called Direct Buy Auto Warranty.

She paid $1,850 for a three-year warranty. She said she never had to use it.

Because she sold the car after just one year, she still had two years of warranty remaining, which she said the company was supposed to return to her.      

After several months of waiting, however, her $1,100 -- the balance left from the unused warranty -- never arrived.

She said she called Direct Buy Auto Warranty but was never able to speak with anyone. 

"Nobody really answers the phone.  It just  rings and rings and rings," Zydek said.

3 On Your Side got involved and we tried calling the warranty company, but we experienced the same problem with no one answering.  3 On Your Side got a recording, but never a person.

"Thank you for calling," the recording says.  "We're all busy right now but please hold, and someone will answer when they become available."

Apparently Direct Buy Auto Warranty, which is headquartered out of New Jersey, has a troubled past.

3 On Your Side discovered the New Jersey Attorney General's Office recently sued Direct Buy Auto Warranty for allegedly violating the state's Consumer Fraud Act.

Not only did the AG ban the company from doing further business in Jersey, the office also made Direct Buy Auto Warranty fork over $810,000 in a settlement.

The Better Business Bureau gave Direct Buy Auto Warranty an F rating after the company racked up close to 300 consumer complaints.

After numerous telephone calls, emails and even requests sent via fax,  3 On Your Side never did hear from Direct Buy Auto Warranty.

Zydek said she now wonders if she'll ever get the money she claims the company owes her.

"I don't know how you can legitimately take people's money and promise things and not be held accountable," she said.

Consumer advocates recommend you stay away from extended warranties, particularly on cars.

They recommend taking the money you would have spent on a warranty policy and saving it for an emergency.  Had Zydek followed that recommendation, she would have kept her full $1,800.

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