You recently purchased a new home and now you have a plumbing problem. You remember the home came with a home warranty. But how exactly does this work? Will everything be covered? Is the repair company a reputable one?
It is important to start with a clear understanding of what exactly a home warranty is — and what it isn’t.
Home warranties are plans that pay for repairs and sometimes replacements of household appliances and systems — things like dishwashers, plumbing, furnaces, and air conditioning. Some may even cover the refrigerator, washing machine, and dryer. It’s a type of service plan: When you run into problems, you call the warranty provider and it facilitates getting things back in proper working order. Not to be confused with your homeowner’s policy, which provides insurance coverage for the damage or destruction of your home and its contents.
As a new home buyer, it’s common for the sellers to throw in a one-year home warranty to sweeten the deal. Some buyers will even make this part of the negotiations to help with any unforeseen repairs. If one is provided to you, you’ll eventually need to decide whether you want to keep it and pay the cost yourself. If one isn’t provided to you, you’ll be barraged with solicitations to buy one. Knowing the pros and cons will help you make the best decision for your situation.
Pros
Peace of mind.
Every homeowner dreads having to shell out a lot of money on a major repair. For example, installing a new air conditioner compressor could cost thousands.
That’s especially true if you’re a new homeowner who just depleted your cash balances to close on the sale. A home warranty gives you an opportunity to push some of that major repair risk over to a warranty provider.
Convenience.
When something breaks down around the house, your first job is to decide who to call to fix it. With a home warranty, you get to skip that step. Rather than researching your options and getting competing quotes, you simply call the warranty service company and they make the decisions about who will take care of your problem.
Cons
Service call fees.
Though home warranties can cover a lot of repair expenses, they don’t cover all of it. Typically, every time an incident happens, you’ll need to pay a service call fee anywhere between $45 to $125 and up. If more than one type of technician is needed for a given repair, you may have to pay that fee to each of them. Typically this cost is more than the contractor’s service fee if you were to call them directly.
Fine print.
Home warranties are only valuable to the extent that they actually cover the repair or replacement you need. Some policies have covered amount limitations. If you have an older home, make sure to find out if there’s a limit to how much a home warranty will pay per incident. Also, check for information about code upgrades — if your water heater goes out and you need to bring the system up to new code standards, the costs could be significant. A home warranty may have limitations on the amount it’ll cover, or it may not cover it at all.
Service uncertainty.
A warranty is only as good as the company that stands behind it.
Less control.
You can schedule online or simply call 770-268-2331 .
