FINANCIAL

FROM MARY HUNT (DEBT PROOF LIVING)

ON BUYER PROTECTION PLANS

Hyundai Motor Co. started something when it unveiled its Buyer Assurance Plus program, which offered to cover three months of car payments if a buyer became unemployed. If that buyer couldn't find a job after 90 days, Hyundai promised to take the car back without penalty, and the buyer would owe nothing. The plan prompted other car manufacturers to offer similar plans to return confidence to new car buyers.

Ford Motor Co.'s Advantage Plan promised that the company would make the buyer's car payments of up to $700 a month for a full year in the event that the buyer got pink-slipped. General Motors also offered job-loss protection, promising to make car payments of up to $500 a month for nine months. All of these protection plans have now expired, but their influence lives on.

In June, 2009, Salzman Real Estate Services in Colorado Springs, Colo. announced its own protection program for homebuyers called the Job Loss Protection Program, and other realty companies throughout the U.S. followed suit. Now, department stores are getting in on the protection plan action, too.

Recently, Sears announced the Sears Buyer Protection Program for home appliances. Buyers using a Sears card to purchase major home appliances totaling over $300 are automatically protected, including service agreements and installation and delivery charges, at no additional cost. Simply make a qualifying purchase by Aug. 1, 2009 and if you lose your full-time job after 60 days and up to one year from date of purchase, Sears will cover your payment for every month that you are jobless. If you are still unemployed after one year, your appliance will be paid off in full. You get to keep it, too.

Here's the deal with buyer protection plans: They all have qualifying terms and conditions. Some plans are so tedious it's difficult to imagine that anyone could adhere to all of the requirements. Others are simple. If you are considering any buyer protection plan, carefully read all of the fine print.

I've looked carefully at the Sears program, found at SearsBuyerProtection.com. I believe this one is remarkably straightforward. There are, of course, measures built-in to prevent fraud, which means that those who do qualify need to offer proof of employment at the time of purchase. Then, they will be required to show eligibility for unemployment benefits as proof that they lost their job in order to file a claim for benefits. These requirements are reasonable.

Originally, the Sears Buyer Protection Plan was scheduled to end on Aug. 2, 2009. However, I have a feeling it might be extended if the company finds that this plan boosts their customers' buying confidence, which they tell me is the whole point of the program in the first place.