Benefits of a Home Warranty?

When people buy a house, expectations are that everything will work out according to plan. Having things already in place, there are little to no chances for any malfunction to occur. Unfortunately, that is not always the case. There can be major costs involved while buying a house, new or old, and it is always better to be safe than to be sorry later.

Whether you are a buyer or a seller, the benefits of investing in a home warranty plan to stay protected from costly repairs can be a smart move. Home warranty plans like any other plans are there to protect your most valuable asset – your home. Different warranty companies provide various features in a certain plan but a clear understanding can always narrow down the best plan for your needs.

Benefits of a Home Warranty

Who Pays for Home Warranty?


During the purchase of a home, the seller generally pays for a home warranty plan in order to minimize the fear factor of the buyer. However, it is in the best interest of a homeowner to have a home warranty plan already in place in order to keep their house properly maintained and in good working condition. Proactive realtors understand the importance of obtaining a home warranty plan especially for the buyer, and they should ensure one is in place as an add-on to the purchase contract for the seller to hopefully pay.

Why Get a Home Warranty?

Most used houses have problems that emerge sooner or later after the purchase. Considering the fact that from the sink, toilets to dishwashers, everything is once used by someone. At times, there are various faulty reasons to sell the house, thus it is always a safe bet to get a home warranty. It also helps as many appliances are out of their warranty during the time a house is sold which makes home warranty a safe investment. If an appliance malfunctions, the warranty usually pays off during the first visit.

In cases when purchasing a new house, the home warranty might not be as effective as the appliance and the materials are new. Unless if there are customizable options to the plan, buying a home warranty might not be cost effective.

How Much is a Home Warranty?

Depending on the options and coverage, the rates vary. A safe estimate is $250 to $450 for a yearly warranty which is affordable by most homeowners. Companies offer prepaid services which allow renewals or expiration.

Home warranties and their cost operate according to coverage plans and the company’s history of loss for each particular item repaired. When there is a breakdown of any appliance or household item covered by the insurance, a call is made to the warranty provider who sets a date for repair. There are two instances if the problem is able to be fixed or not. When the appliance or any item is fixed, there are no overhead charges. If the problem is not fixed and is applicable under the providers’ policy, there is a small replacement cost, usually under $100 and a new appliance is provided by the company.

It is, however, important that all appliances for which the warranty is bought are compliant by the company. Some appliances are not under the modern regulations and can cause major costs and should always be cleared beforehand.

What is Covered in a Home Warranty?

Most electric appliances are covered by the warranty, which includes and are not limited to ceiling fans, internal heating and cooling systems, ducting and ceiling of the house, telephone and electric wiring, ovens and dishwashers. Furthermore, there are also options which allow upgrading with more options.

What is Not Covered in a Home Warranty?

There are also items which are not covered by the warranty which include pre-existing conditions, repairs from owner’s negligence, or repairs that do not fall under reasonable usage or improper use. These are claim denials which may not covered by the home warranty policy.

For long-term investments on houses bought through dealers, it is mostly a safe bet to buy a home warranty. For new houses, there are limited chances of malfunctions. It is always a good idea to involve the real estate agent before buying a specific warranty for your house. For more information on home warranty policies when buying a home, contact our real estate professionals today!

Who Pays for a Home Warranty?

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