Things To Know About Home Warranties Coverage

Home ownership has long been considered a major part of the American Dream.  For most individuals the purchase of a home is the biggest investment of their lifetime.  With the pride of home ownership comes a financial responsibility that can often leave homeowners struggling to make ends meet.  Maintenance, repair and renovation can be costly, however there are options available to reduce out-of-pocket expenses, making home ownership more affordable.  A home warranty is one such option.  It is important for homeowners to understand exactly what type of warranty they are purchasing before signing on the dotted line.
Home Warranties Coverage

What is a home warranty?

When a homeowner purchases a home warranty, they are basically entering into a service contract that provides for the repair and replacement of certain home appliances.  In addition to appliances, a home warranty may cover repair or replacement of major systems in the house such as heating, electrical and plumbing.  A home warranty does not cover any and all repairs in the home and each contract may vary.  For this reason, homeowners must take the time to carefully review and understand the terms of coverage before purchasing the home warranty.

Things to consider when buying a home warranty.

With so many variations out there, you may be wondering how you can spot a quality home warranty from one that provides little or no real coverage.  The following tips will help you make your final decision.

  • Most home warranties will cover major systems in the home such as heating, cooling, plumbing and electrical.
  • In order for items to be covered under the warranty, they must be in good working order at the time the warranty is purchased.
  • Pre-existing and structural problems are not covered by a home warranty.
  • The warranty company retains the right to make final decisions regarding repair or replacement.  This may cause an issue if the homeowner feels something should be replaced and the warranty company believes a repair is sufficient.  If an item is replaced, the warranty company will choose the replacement item.
  • The warranty company will select the technicians or service provider responsible for repairs and replacement.
  • Contracts and coverage are unique to the warranty company.  Carefully read the contract in its entirety to learn about restrictions, exclusions or conditions which may affect you coverage.

Is a home warranty right for you?

Clearly there are many variable which must be considered before deciding if a home warranty is right for you.  In most cases, a home warranty is included in the sale of a property and provides some level of comfort for both the buyer and seller should something go wrong in the immediate future.  That being said, a home warranty is only as good as the company backing the warranty and the terms of the contract to which you agree.  By knowing in advance what issues are covered and what situations are excluded, you can determine if the cost of a home warranty is a worthwhile investment or a waste of money.

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