It makes my blood boil to hear these stories of dealers taking advantage of naive buyers. If I were you, I would negotiate only one thing with the dealer - the price.
I would not even consider financing through them. Shop around - you can do better. Finally, I'm pretty sure Heartland does not sell extended service plans or endorse any particular plan. So, the dealer is lying to you and trying to sell you an overpriced plan. Again, shop around, you can do better, and you don't need it for a year.
Yeah, I'm not big on the financing through them either. We have financing through a bank but the bank is taking longer than we'd anticipated to get the paperwork to us b/c the agent is on vacation. Between Heartland delaying the build and the bank, we're already behind our schedule for the summer. I know, that's funny. Don't even have the thing yet and we have a schedule. Anyway, we're not thrilled with the bank for the simple reason that they keep requesting more paperwork which means more faxing, they won't send the check to the RV dealer (only to our house, which makes sense but means another delay since we're driving so far to get the RV), and they conveniently didn't tell us about a "loan fee" until today. We went with them because they offered the best rate. But between the time our original loan was approved and now, the interest rate went up half a point. No idea why.
If we go with the dealer, we can pick the unit up immediately.
Anywho, now the dealer's rate is actually better than the bank's rate. And it'd be even better if we bought the service plan (which is on sale...or something.)
Again, that will all come down to the math I suppose. How much will the lower rate save us compared to the price. And then what will insurance cover.
We called Progressive and they said they'd cover the baseball breaking the window, scratch damage, tire blow outs, things like that. After the deductible of course. Eric specifically asked about replacement and they will completely replace the vehicle should something awful happen. They won't cover the leveling system if it goes.
Thanks for all your help!