Is a Home Warranty For You?

When you have found the home that fits your style, budget and wishes, you may want to contemplate whether purchasing a home warranty would be beneficial. An important aspect to consider is whether this investment would be worth it. Evaluating the condition of the home and the likelihood of needing to repair or replace items like appliances and systems should factor into your decision. How much would it actually cost to repair some of the main systems in your home, if they were to break down? Figure in systems like your heating and air conditioning, which may costs thousands of dollars to repair or replace. Next, think about items like a hot water heater that could also run several hundred dollars. After you evaluate how much it would cost to restore these items, compare that to the amount of money you are going to have to pay out on the annual premium and the fees for a service call. Comparing these figures will help you decide whether or not it is worth the money to get the home warranty.

Keep in mind that even when your home is brand new, things can go wrong. Appliances break down and systems fail. If you have just spent a fortune on your new home, the last thing you want is to invest more money. A home warranty extends peace of mind provided you have the right one. This type of insurance protects against some of the catastrophes which can and do happen in new and mature homes alike. Here are some tips on home warranties.

If you are purchasing new construction, check with your builder first. Many builders will offer some sort of warranty. In certain states, builders are actually required to offer a warranty that can last for as long as ten years. The potential problem with the builder’s home warranty is that it can very often be hard to track down a builder for warranty claims once they have begun to focus on a a new project. Even if your home comes with a warranty by the builder, this is often only for the actual structure and will not include things like your appliances or other major systems that can also be pricey to repair or replace. These builder’s warranties are usually included in the price of your home, so you won’t have the extra out-of-pocket expense. Another type of warranty is one offered by an independent third party company. This is a warranty that you purchase on your own, and they usually cost a few hundred dollars a year. This price can be a real bargain if your home is going to need repairs, because the policies usually last for at least 10 years.

When choosing home warranties, it is necessary to look at the fine print and see exactly what your policy includes – and, more importantly, what it excludes. It is essential to understand how a home warranty policy works. When an appliance or system breaks down you contact your specific home warranty company. The company then contacts the service provider, who repairs or replaces the system or appliance. It is your responsibility to pay for the service call charge, which is usually less than $100. Items typically covered by home warranties include air conditioning, heating systems, fridges, ranges, ovens, refrigerators, fans, indoor plumbing, electrical systems, garbage disposal and telephone wiring. Not all plans cover all these items, and many outdoor systems may be excluded. Check your individual home warranty for guidance on your duty to maintain equipment, as failure to do this or atypical wear may invalidate your policy.