A home warranty is a service agreement that covers the expense of repairing or replacing covered goods, such as significant kitchen appliances and electrical, plumbing, heating, and cooling systems. A home warranty can lessen some financial stress new homeowners experience when a major appliance or home system breaks. Below are the things you should know about home warranties:
Insight
While many consumers enjoy the peace of mind that a home warranty can offer, some find that their experience is not quite what they expected. Home warranty providers have built-in wiggle room to avoid paying out for issues that are not their fault. Many consumers file complaints with the Better Business Bureau because they weren’t appropriately covered. For this reason, consumers should carefully consider the benefits of a home warranty plan. Here are some of the benefits and drawbacks of home warranty coverage.
A good home warranty such as First American Home Warranty can help close a deal when buying a home. It can also save the seller a significant amount of money by replacing expensive repairs that buyers may request. A home warranty plan can also help close a deal when a buyer is nervous about the home’s mechanical condition. A home warranty plan is a valuable bargaining chip in a competitive market. If you have a home warranty plan, negotiate your price with the seller.
Exclusions
One of the most important things to understand about home warranties is their exclusions. Many home warranty policies exclude specific repairs, such as sinks, and can only cover certain appliances or systems. Exclusions can also limit a company’s pay if a system or appliance needs repair. Knowing which exclusions to look out for can help you avoid costly repairs later. Here are some examples of exclusions:
The exclusions of home warranties vary from policy to policy, but it is essential to read the fine print to ensure you’re getting the most for your money. Home warranties may cover only certain appliances and systems, and you may need to pay extra for certain parts. Some home warranty plans don’t cover plumbing, HVAC, or recently-repaired items. You should also read the policy carefully to ensure that it covers everything you need.
Expiration
If you purchase a home warranty from a builder, you should know that it will usually expire one year after the purchase. This marks the last opportunity for you to determine what needs to be repaired or replaced. Professionally document any repairs or adjustments to make the home safe. Home warranties for new homes generally provide limited coverage for various components and usually state how repairs will be done. Expiration dates should be adhered to so you don’t find yourself in a bind when they are due.
Home warranties can be renewed online. The length of the coverage period depends on the home warranty company you choose. Most plans last 30 days, but some start earlier. However, if your warranty expires within thirty days, you’ll have to pay the full cost of the repairs. In addition, if you’re looking for a home warranty that offers more benefits, such as guest unit coverage or appliance coverage, you should consider a plan that includes additional coverage.