|
HOME WARRANTIES
A home warranty will protect you from having to pay
thousands of dollars on repairs and avoid turning your
home into a money pit. When in the market for a
warranty, it is very important that you know exactly
what you are going to be covered for. It is equally
important that the company insuring you is a reputable
one.
Types of Home Warranty Coverage
There are two main types of home warranties: ones for
existing homes that have previous owners and those for
brand
new construction homes.
Pre-owned home warranties
Typically cover normal wear and tear on the mechanical
systems of the home. However, they do not cover
pre-existing issues. Mechanical system coverage means
the central cooling and heating systems, water heater,
oven, range and hood, dishwasher, interior electrical
and plumbing systems, garbage compactor and disposal,
and the electric garage door opener. You will also have
the choice of adding on options for covering
pre-existing problems, as well as spa, pool and/or well
pump coverage. The normal price range for pre-owned home
warranties is between $250-500/year with the option for
renewal every year.
Most
new home buyers keep warranties for the only the
first year of homeownership. It is also not uncommon for
homeowners to renew their policy every year.
New home warranties
These types of warranties are issued by the
developer at
the closing. They typically last for ten years and offer
coverage for structure, foundation and roof of the new
home. Homeowners will also have the choice of adding on
options that will cover materials, workmanship and the
electrical system of the home.
Why Buy a Home Warranty?
A home warranty offers piece of mind. Suppose you just
purchased a newly constructed home and the
air-conditioning system stops working. Having a home
warranty will protect you from having to pay for the
bill to fix the system, which can be as high as several
thousand dollars!
In many states an existing home warranty is included in
the sale of homes.
Having a Warranty Is Not a Guarantee
It is not uncommon for a home warranty to have a cap
on the amount that can be paid towards repairs.
Therefore, you should always know what your contract
says before committing payment towards it.
Also, make sure your warranty company is a reputable one.
If they go out of business, you will have no recourse.
It always a good idea to check with the
BBB to find out about a
company and its history.
Prior to buying any home, it is important that you have
the
house inspected so you know what you are getting
yourself into.
We also invite you to read the
home purchase guide.
|
