What do home warranties cover?
Home warranties act as a protection plan for unexpected repairs after you purchase a home. Systems such as electricity, plumbing, heating and air conditioning are usually included. Some plans cover major appliances including clothes washers and dryers, ranges or range tops, refrigerators and garbage disposals while others include garage door openers, built-in microwave ovens, trash compactors and sump or well pumps. Many home warranty companies offer special plans or customization options that allow you to add more coverage if desired.
How much do home warranties cost?
Pricing varies depending on the type of property you're purchasing. Coverage for a single-family home typically costs somewhere between $175 and $400 per year. Extra coverage incurs a higher fee. Plans may be paid for up front or in installments depending on the policy of the warranty company. Factors that shouldn't affect pricing include square footage and the age of the home. An exception is new homes, which may cost a little more. Note that most warranties require you to pay a small service fee each time a repair technician or contractor is called.
How do I know if I need a home warranty?
As a home buyer, a home warranty offers peace of mind when it comes to unforeseen repairs. Malfunctions in home systems or appliance breakdowns can cost a great deal to fix, requiring you to put out more money over and above the price of the property. If you purchase a warranty and need several repairs over the course of the year, the warranty will more than pay for itself. Home warranties can save you money in the long run, which can be helpful if you have little or no money in reserve after buying a home or are trying to hold on to some money for future needs. Those who aren't comfortable doing home repairs can also benefit from a warranty. If you're new to an area, a home warranty can guarantee that you'll have a reliable contractor to quickly fix any problems that arise rather than rushing around trying to find someone in an emergency.
Is homeowner's insurance the same as a home warranty?
No. Insurance and warranties for your home are two separate things. Homeowner's insurance, also known as "hazard insurance," is meant to cover outside threats such as water damage, hail, fire, high winds, certain types of vandalism and other potential damage to the structure of your home or the items stored within it. Homeowner's insurance may also include liability coverage to protect you in the event that someone gets hurt while on your property. By contrast, home warranties cover repairs to household systems.
Is there a limit on the number of service calls that I can place per year?
Most home warranties are in place for one year and don't put a cap on how many claims you can make during that time. The point of the warranty is to cover everything in the policy no matter how often repairs are necessary. However, policies may put a limit on monetary coverage for certain appliances or systems. These limitations will be detailed in the policy.
Are home warranty plans renewable?
Companies generally do allow you to renew your warranty. Renewal policies vary by provider, so if renewal is important to you, inquire about the procedure before purchasing the warranty. If you can't pay for renewal up front, some companies offer payment plans for one or more years' worth of extended coverage.
Should I buy a home warranty as a seller?
Adding a years home warranty to your property makes your house a much more desireable option for potential buyers. They know that all the appliances which come with the property are covered in case of emergency, and you know that you wont be called with problems or queries in those first few weeks or months after a sale.
My appliances are old. Can I still get a home warranty?
Absolutely. Many companies don't even require a home inspection before you enroll with their subscription plans. In fact, if you have an old house with old appliances, it makes even more sense to sign up for a home warranty, as older appliances are more likely to break down, leaving you in trouble.
What if I'm not sure how old my appliances are?
That's also fine. The best home warranty companies can either come out for a free appliance consultation, or sign you up regardless of the age of your appliances. Remember that in some cases this may affect whether you recive a new appliance or a cash payment if the appliance breaks.
I'm a renter. Can I still buy a home warranty?
If the appliances came with the property, your landlord is responsible for buying the home warranty. Most home warranty vendors sell warranties for rental accommodation, mobile homes and condos as well as single family and multiple units.
I'm a landlord. Should I think about buying a home warranty?
100% Looking after another home as well as your own can be costly and inefficient, especially if you don't live close by. A home warranty gives you the peace of mind that someone else is looking after any breakdowns in the property, and they are being dealt with by experts. It also gives your tenants confidence that they will get any problems fixed quickly and professionally.
As a landlord, are there any additional questions I should be asking?
Remember that some home warranty companies will only work with individual homeowners, and not real estate management companies, so think about how you are managing your properties before you subscribe.
As a landlord, can my renters deal directly with the contractors when they arrive?
Yes, usually. Just be aware that many of the trade service fees need to be paid in person, which requires your renters to lay out the cost regardless if you are paying for the call out. This can be easily solved by taking the amount off that months rent, or perhaps paying your renters that sum in advance in case of a call out.
What if I am selling my home within the contract term?
Don't worry! Your subscription will simply transfer to the new owner, which makes your home an even more desireable purchase, especially if your buyers are new to the area and don't want the hassle of finding local contractors for every job they need done.
Are there any extras I can take advantage of when buying home warranty?
Look out for bonus features you recieve on signing up with a home warranty company. Some companies offer you exclusive discounts on eating out and retail, or entry to cashback opportunities while shopping online. Some come with the ability to sign up free of charge to emergency help services, which contact your loved ones in a medical emergency.
What customer service options can I expect?
I don't know about you, but we would want to know that we can reach help 24 hours a day, and that's what you can find with the top home warranty companies on the market. Do some research to find the company which offers your preferred method of contact. Some companies offer a 24/7 phone line or live chat, while others rely on email.
What happens if I have a claim?
Simply phone your home warranty company directly, and they will take over from there, organising for a skilled contractor to come to your home and complete the repair.
How long will it take for them to send someone out?
You will need to do some research into the different companies to see what response times they guarantee. Remember this may vary during the business week and on public holidays and weekends. In general you can expect someone to be called out within two business days.
Will I have any say in the contractor who comes to my home?
Probably not. This is one disadvantage of home warranty. While you don't have the hassle of phoning around finding a suitable contractor, and worrying they might not complete a good job, you do have to trust that the company will choose well for you.
How do I know the company will choose trustworthy contractors for my job?
Take some time to read the customer testimonials for different home warranty companies before you sign up. This can be a great way of seeing what different company contractors are like. Remember, home warranty companies have long-standing relationships with contractors and they are all likely to be excellent at what they do.
Which safety features can I expect the warranty company to employ when choosing contractors?
As well as reading customer testimonials, you can ask the company how they verify the contractors they choose. You can also ask about the contractors qualifications and references for ultimate peace of mind.
What happens if my appliance cannot be fixed?
In a situation where your appliance is beyond repair, the home warranty company will usually replace it for you altogether. Another great incentive to sign up if you have appliances which are on the older side.
What alternatives might I be offered to a replacement?
Check the contract of your home warranty agreement. While many companies will replace an appliance if it cannot be fixed, they may also reserve the right to offer you a cash reimbursement to the value of the appliance currently.
Who decides if my appliance cannot be fixed?
Usually, this is done by the third party contractors. This is a neutral and fair way to asses the condition of your appliance, and ensures that both parites get an unbiased report so the next steps can be considered.
Can a home warranty company offer advice?
Check the websites of the major home warranty companies. Many of them offer helpful tips, blogs and advice on keeping your home and appliances well maintained and looked after, which can reduce costs and call outs greatly.