A Home Warranty-Simple Options for New Home Owners

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Real Estate

Hello & Welcome Back to #FabulousFriday!  One of the scary ideas that deter buyers from taking the leap from renter to property owner is the worry and stress of home maintenance and repairs.  It's inevitable.  At some point, appliances and home systems deteriorate and require repairs.  One solution is a home warranty.  

Some would be homeowners are pretty handy, but others are not.  In fact, some don't know a socket wrench from a plier.  And who should you call?  How do you know you won't get overcharged due to a lack of knowledge?  These benefits are some incentives when considering purchasing a home warranty.

However, a home warranty is not a blanket insurance policy against anything ever going wrong in your home. It’s not a permanent warranty. It does have exclusions. Before you purchase or accept a warranty, it’s good to know what the warranty is, what it covers, what it doesn’t and how it works.

How does it work? Most home warranties are very similar. You’ll want to read your warranty thoroughly and mark anything you don’t understand to have explained to you.

Typical Guidelines:

If a home system or appliance breaks down or stops working, you call the home warranty company.

Your home warranty company will call a service provider it has a business arrangement with.

The service provider will call you to make an appointment.

The service provider will fix the problem. If an appliance or system is malfunctioning and can’t be repaired, depending on your contract coverage, your home warranty company will pay to replace and install the appliance.

You will pay a small trade service fee (usually less than $100).

What if the service provider doesn’t fix something to your satisfaction or says that the problem is your fault and isn’t covered by your warranty? Call your real estate agent. Many real estate agents have a relationship with the home warranty company representative and can help to seek resolution for you.

What’s not covered? Check your specific policy, but in general:

Outdoor items such as sprinklers l Faucets l Refrigerators, washers, dryers and garage door openers l Spas and pools, unless specific coverage requested l Permit fees l Haul aways

What can cause denial of a claim?

Improper maintenance l Code violations l Unusual wear and tear l Improper installation

General coverages include:

Air conditioning l Dishwashers l Doorbells l Furnace/heating systems l Water heaters l Ductwork l Garbage disposals l Inside plumbing stoppages l Ceiling fans l Electrical systems l Range and oven l some wiring

Remember, it is your responsibility is to read thoroughly and understand your warranty before you agree to the terms. Be sure to clear up anything you don’t understand before you sign anything.

Sellers May Offer a Warranty As Part of the Sale of the Home:

Does the seller have to pay for the home warranty?  It’s not a requirement, but if you’re the seller, buying a home warranty for the buyer may be beneficial in several ways.  

Remember, for people looking to purchase a home, one of the big worries is whether or not they’ll accidently buy a money pit. If you offer a home warranty as part of the sale, a potential buyer can feel confident in their investment and that means your house may sell more quickly and maybe for a higher price.  

It could save you money if something breaks down while your house is on the market. You know what doesn’t impress a buyer when taking a tour of a home? Broken stuff. It may be hard to imagine during a hot seller’s market, but sometimes your house might take a while to sell. While you’re waiting for someone to make an offer, appliances can start to act up. If the home warranty is purchased by the seller, the warranty will cover the home while it’s on the market and then transfers to the buyer upon closing. 

Buyers May Want to buy a warranty as part of the home purchase:

Are there advantages of purchasing a home warranty if you’re the buyer? 

If you're the buyer, you may think asking the seller for a home warranty is the way to go. Throwing the home warranty cost to the seller means more money saved, right? This may be the optimal choice, but remember that whoever buys the warranty is in charge of the level of protection.   

For practical reasons, many sellers will purchase whichever home warranty plan is cheaper, which may leave gaps in your coverage. If you opt to buy the home warranty through your real estate agent, you may be able to negotiate the seller down a little in price and get your preferred home warranty included in closing costs.   

Need help or have questions?  Call your friendly professional Shaffer Real estate agent today!  See you next Friday for more real estate tips and tricks. Warmly, Susan