Home warranties are pretty straightforward, right? They are part of the negotiation with sellers and, should a seller choose not to purchase one, the buyer has the option to purchase one on their own. If a covered item fails, such as major systems in the home like the air conditioning, the homeowner only has to pay a small fee to have it repaired or replaced.
It’s important to know that a home warranty is not homeowner’s insurance, which is designed to protect you against “fortuitous events,” such as fire, theft, and hurricanes. And unlike a home warranty, home owners insurance will cover all elements of the property unless they are specifically excluded by the contract.
A home warranty covers only the listed items when they fail due to normal wear and tear. Typically, those listed items include HVAC units (a standard policy will typically only cover one unit), plumbing, electrical wiring, hot water heaters, ovens, cook tops, garbage disposals, and built-in kitchen appliances, such as microwaves.
Warranties can be customized to include an additional refrigerator, washing machine, pool and spa equipment, septic systems, pest control, sprinkler systems, garage door openers, smoke detectors, door bells, ceiling fans, and more. Adding these items costs an additional fee, which is something to discuss with a qualified Realtor if you have questions.
Also, it’s important to know that even when something stops working, such as your oven, the repair may not necessarily be covered. Home warranties do not cover systems and appliances that have been abused or not properly maintained or those with pre-existing conditions like shoddy repair work, rust, or corrosion. However, some companies do offer warranties that include unknown pre-existing conditions.
Home warranties don’t always include all the components of a covered item. For example, your oven’s clock may not be covered unless it affects how the oven functions; if it’s not essential, it’s not covered under most policies. Other components that might not be covered on your oven, to continue the example, include the rotisserie, racks, handles, and knobs.
So, how does your home warranty work if you need one? It’s simple: when a covered item stops working, you can either call the customer service line or, with some companies, place a service request online. Your home warranty company will send a licensed contractor to diagnose the problem and either make the necessary repairs or replace the item with a new, brand-name product with comparable features.
Without a home warranty company, you’d be scouring the Internet for a reputable provider and you’d have to pay the entire expense of the repair or replacement yourself. With a home warranty, you’ll pay each specialized contractor that visits a service call fee, plus the cost of any components that are not covered.
A home warranty can be a powerful sales tool, especially on homes that are more than a few years old. Buyers know that if anything fails due to normal wear and tear, they’re covered.
If you want more clarification on home warranties, feel free to give me a call or fill out the form below and one of the Matheson Team members will be in touch soon.