If you’ve only rented before, the necessity of a home warranty may be unknown to you. As a renter, you are used to a landlord who will fix any issues you run into – but that all changes when you become a homeowner. Now, when a water heater breaks or the fridge starts to leak on the new floors in the kitchen, there is no landlord to call. So what do you do?
You may have a friend or family member who can handle the smaller fixes, but when it comes to the big issues that will end up emptying your pockets, a home warranty can save the day. A home warranty is similar to insurance, as it covers some or all of the costs of replacements or repairs when a system in your home malfunctions. They range in annual costs of $300 to $900 and become the middle man in the fixing process. Instead of finding someone to fix an issue, you contact the warranty provider and they set up the repair or replacement with the appropriate vendors. Your premium usually covers all costs, with the exception of a co-pay, which is between $100 to $200 per issue.
If you’re wondering who should buy a warranty, they usually are recommended for first-time home buyers who have rented up until that point. When you are used to having a landlord, a home warranty can fill that role in a different way.
Home warranties are great for homes with both members in the work force outside of the house or just busy family members who can’t always be there to wait for the repair person window or find the time to even get quotes for the best repair shops in the area.
Home warranties aren’t just for first-time buyers. If your appliances are nearing the end of their life expectancy, now would be a great time to get a warranty. if all of your appliances were purchased in the same time frame, you don’t want to face the costs of them all failing at the same time. Warranties can save you time and money – especially in the first year of ownership.
Warranties are different and it’s important to compare before purchasing one. Some have larger deductibles, and some have add-ons for appliances, HVAC upgrades and other things.
Review any policy before committing so you know exactly what is covered. Ask for a list of vendors to see if the company has vendors in the area that can service your needs.
Remember to read the fine print and, if you are working with a Realtor, ask questions. They can help you through finding the right warranty for you.