The Good and Bad of a Home Warranty
Home warranties, also known as residential service contracts, are supposed to cover the repair and/or replacement of certain systems or appliance that fail due to normal use during the term of the contract.
A home warranty is different from insurance in that it doesn’t insure against losses. It only covers items specified in the contract that need repair or replacement due to normal use. Typically a year’s coverage is $350 to $600. Depending on the coverage. But there are things in the small print you should be aware of.
There is a co-pay. Just like going to the doctor. Typically they are $65 to $100. It is a one-time fee for the service. Typically someone comes out, diagnoses the problem and gets with the Home Warranty Company to see if it is something covered. If so, they will either fix it then, or schedule a time for someone to come back and fix. Be careful that if someone else has to come out, you don’t pay the co-pay again.
Remember I said read the small print? Some companies will not cover an Air Conditioning unit if the filter is dirty. Dishwasher leaking….better be in the dishwasher and not the plumbing going to the dishwasher with some companies. Need a new A/C unit, but the new models are larger than the old unit? Some companies will not cover enlarging the area for the unit. Also, if you have 2 condensing units or a pool, that is an extra. Not all cover all appliances. So make sure you know what the policy covers. Read the small print. Ask questions of the company. There are many to choose from, and I would recommend reading customer reviews of the company.
Some people swear by them, and keep one in place on their homes for many years. Many have one the first year after they purchased a home and don’t renew it. Some have had one and will never purchase again after a bad experience. Whichever one you decide on, keep all your paper work and brochures you are given, along with the representatives contact information.
I have had people ask if they needed one for a new home. Typically a new home comes with a warranty for all appliances for 1 to 2 years, and a builders warranty to cover electrical and plumbing. So, find out what your new home builder offers, and make your decision from there. I typically advise if the home is 7 years or older, you do want to consider one, due to the life expectancy of the homes systems in place. But, do your research and compare companies that offer Home Warranties in your area.
Sherry Scales, REALTOR®
CLHMS, GRI, SRES, ABR designations to serve you better.
Austin Texas Homes, LLC
512.925.8928 Cell
Visit my website: www.SearchHomesInLakeway.com to search for homes.
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