Why a Home Warranty?
Buying a home is an expensive task, especially if you are a first-time home buyer with no equity built up. It can seem like you are paying for expenses that continue to hit you the entire month or so until you close. Given how much you pay out of pocket for a new home, the cost of an appliance breaking or a major system failing in your home could end up to be a nightmare. However, you can protect yourself against the unknown by arming yourself with a home warranty when you purchase your home. You can expect to pay around $300 for a home warranty, but in most cases the protection is well worth it.
What is a Home Warranty?
A home warranty covers the major systems in your home such as electrical and plumbing as well as major appliances in the home. If you have an issue that requires repair or replacement after your purchase your home the home warranty will replace or repair the item based on circumstances. Depending on the type of home warranty you purchase, the entire cost may be covered or 50% of the cost may be covered. Most home warranties are inexpensive when you consider the cost of new appliances or repairs to major systems. They are usually good for the first year after you purchase a home and can be renewed following that year if the homeowner wishes. It is generally cheaper to purchase a home warranty policy at the same time you purchase your home versus waiting to do so.
What Does a Home Warranty Include?
A home warranty covers most major appliances and systems within your home. This can vary by home warranty provider so it is important that you double-check what is covered before you sign papers. However, in general a home warranty should cover plumbing systems, HVAC systems, plumbing systems, major kitchen appliances such as the range, oven, and garbage disposal, and the washer and dryer. If a home has a septic tank, external well, or swimming pool you can sometimes add on extra coverage to extend your warranty to these items.
It is important to know that a home warranty is not the same thing as homeowners insurance. You will be required by your lender to pay for homeowners insurance as part of your mortgage costs. Homeowners insurance only covers in the case of damage to your home as the result of a calamity or accident such as fire, floor, storm, etc. It will not cover any items that break or need repaired. Therefore, it is vital that you consider purchasing a home warranty on top of your general homeowner’s insurance.
Home Warranties are Good Ideas for Sellers and Buyers
Both buyers and sellers can benefit by looking into a home warranty for a house that is on the market. Sellers often find that buying a home warranty for the Buyers can help ease their mind and encourage them to make the final purchase. Additionally, sometimes this last incentive can help protect sellers from receiving numerous calls if something does go wrong. Even though legally the seller is not responsible for items in the home once it is sold, some buyers can still hassle quite a bit if they think they have been miss-sold a home.
Do I need a Home Warranty if I Purchase a Newer Home?
Many people assume that if they buy a new home they do not need to purchase a home warranty. It is true that newer appliances and systems are less prone to breaking, but this is not a guarantee. If there are appliances or major systems in the home that are no longer under their manufacturer’s warranty it may still be worthwhile to get the home warranty. Items like water boilers or HVAC systems can sometimes malfunction in spite of their new age, and the cost of replacing one of these items is exponentially higher than the home warranty.
What to Do If Something Breaks While Under Home Warranty
If a home system or appliance has an issue or stops working while you have a home warranty then you will need to call the company that you purchased your home warranty through. At this time, they will call a local provider they are contracted with to come out and take a look. The provider will then either fix or replace the problem depending on the issue. Usually the homeowner will have to pay a small deductible or pay the small trade service fee that is associated with the provider which is generally around $100.
Renewing Your Home Warranty
In general, most home warranty plans only last for year following the purchase of your new home. At that point, most companies will allow you to renew your policy for a marginal price. Given the house and its appliances are now one year old, it is wise to consider renewing your policy to extend your protection.
What Home Warranty Company should you use
Because my list can change I can not list them on here but you can feel free to contact me and see who I’m recommending. Make sure they have a good reputation by checking reviews online. Make sure they don’t pay or reward Realtors to recommend them because that just seems shady to me.
Tulsa Information page or Homes for sale page
Jenks Information page or Homes for sale page
Bixby Information page or Homes for sale page
Broken Arrow Information page or Homes for sale page
Owasso Information page or Homes for sale page
Need a Realtor? (918)730-7075 Tom Coleman Broker Associate at Keller Williams.