Home Warranty, What Is It? Who Should Have One?

So what exactly is a Home Warranty?

A home warranty is not the same as homeowners insurance. A home warranty covers the homes major components such as, but not limited to air conditioners, heating systems, electrical, plumbing and major appliances such as washer/dryer and refrigerator. Coverage can be extended to cover additional features such as a swimming pool or a solar hot water heater.

Home warranties are a 1 year contractual agreement that should any of the covered appliances fail due to normal wear and tear during the coverage period, those items would be repaired or replaced if repairs could not be made. There is a small trade call fee to have someone come out to do any repairs, usually around $60, but this will vary depending on the home warranty company you choose to cover your house.

With home warranties starting around $350 for a 1 year coverage period and only a $60 dollar trade call fee, this could pay for itself in just 1 repair!

The major benefit of having a home warranty is to protect yourself from unforeseen major expenses. It also provides you with peace of mind knowing you may not have to dig into your savings to pay for a major appliance going out. It is also helpful for a homeowner that doesn't have the best handyman skills or for those that don't want to worry about tracking down a contractor if they have an issue. Home warranty companies have specialized contractors to repair or replace anything that is covered in your warranty.

Should YOU have a Home Warranty?

For Buyers- When buying a home there are expenses with closing, down payments, inspections and moving. A new homeowner may be using most of their savings to get into a home. To avoid the worry of any large unforeseen expenses, you should have a home warranty in place.

For Sellers- When selling your home, offering a paid 1 year home warranty with the home purchase may provide a measure of protection against buyer complaints about any home defects that arise after the sale closes.

For Homeowners- Imagine the air compressor goes out in the air conditioner, in the middle of summer, right after you spent your savings on the family summer vacation! Was that worth not paying the $350 a year?

Experienced Real Estate Agents will advise their clients on home warranties with the sale or purchase of their home. They will already be familiar with local and multiple home warranty companies and can provide the necessary information. 

Here are the two companies I prefer to work with in my market:

Yvette Myer @ Old Republic Home Protection CO., INC.

Fidelity National Home Warranty