Benefits of Buying a House With Homeowner Warranty

This guide covers the benefits of buying a home with a homeowner warranty. Most home builders offer their homebuyers a home warranty. Homeowner warranty is different than homeowners insurance required by lenders. A home warranty will not cover defects or repairs from wear and tear.

If a home is 30 years old and the HVAC system is malfunctioning, the home warranty company will not cover the repairs or the replacement of a new HVAC system due to the lifespan of the HVAC.

Home warranty covers defects on any major systems attached to the home except for wear and tear. There are strict coverage rules, policies, and procedures on home warranty policies. In the following paragraphs, we will cover the benefits of having a home warranty when buying a home.

What Is a Homeowner Warranty?

Those who are buying a home, especially first-time home buyers can no longer contact their landlord when things break down. Some responsibilities come hand in hand with being a new homeowner.

Having a homeowner warranty insurance policy, homeowners can gain peace of mind in the event things go wrong. There are differences between homeowners insurance policy and homeowner warranty.

The items that are covered on a homeowner warranty program are not covered by the homeowners’ insurance policy. There are various types of home warranty insurance programs. Before home buyers purchase and sign on the dotted line of a home warranty policy, make sure to read and understand the homeowner warranty policy.

New Homeowner Warranty

Homebuyers buying a new home from a home builder, chances are the home will come with a home warranty. New homes can have a full home warranty without a deductible for the first year and a limited home warranty with deductibles for up to ten years.

Home warranty for new homes for the first year may cover everything which includes appliances, workmanship, mold,  punch lists, and defective fixtures.

Many things can go wrong in a home. Examples of homeowner responsibilities include repairs such as appliance breakdowns, roof leaks, and well and septic breaks downs among to name a few. The longer-term warranty normally includes roofing, foundation, heating, plumbing, air conditioning, electrical, and other non-wear and tear items. In this article, we will cover and discuss homeowner warranties.

Pre-Owned Homeowner Warranty

A pre-owned home warranty covers regular wear and tear items. Pre-existing conditions that are found in older homes are not covered. Most home warranty programs cost between $500 and $1,000 per year. Most home warranty programs do have deductibles and service call fees that can range from $100 and up.

Home warranty policies can be purchased by the home buyer. Many home sellers offer home warranties as part of their seller’s incentive to new home buyers to make the deal more attractive

Sometimes realtors purchase home warranty policies for their home buyers as a courtesy for their business or their marketing program. Home warranties are available for one-year terms and can be renewed each year thereafter.  It is a wise choice to purchase a home warranty at least for the first year for a pre-owned home.

How To File a Claim on Homeowner Warranty

Whatever is on your home warranty agreement, will be covered. In the event, that the heating system breaks down and it is covered under the home warranty policy, the policyholder needs to contact the management company that oversees the home warranty program.

The homeowner warranty provider takes the claim from homeowners. If the homeowner has a claim with their HVAC system, the homeowner warranty company will dispatch a licensed heating contractor.

Homeowner warranty companies will use vendors from their approved list to correct the problem to a working order. The heating contractor will charge the homeowner the deductible. The service fee is agreed upon in the home warranty contract. These will be set fees, and anything above the deductible and standard service fee will be covered under the home warranty contract and agreement.

Can You Renew Homeowner Warranty Policies Every Year?

Homeowners with an active homeowner warranty will probably get a home warranty renewal contract every year.
There might be a renewal fee, depending on the home warranty company. For homebuyers looking for a reputable home warranty company, asking the real estate agent for referrals is probably the best bet.  Most real estate agents have a team of reputable contractors and vendors who they normally work with and also know the third-party vendors and contractors that are not reputable and should stay away from.