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    A Home Warranty May Protect Your New Home From Unforeseen Costly Repairs

    Congrats! You’ve searched and searched, and now you are steps away from closing on your new home. It’s an exciting time, and among the many decisions you have to make as a new homeowner, you may want to consider purchasing a home warranty. A home warranty can act as a financial safety net to protect against unforeseen and costly repairs. We’ve broken down the pros and cons of buying a home warranty so that you can make an informed decision. 

    What is a Home Warranty?

    In a nutshell, a home warranty can cover the cost of replacing and repairing your home’s appliances, systems, and other features. It is typically a one-year service contract covering breaks, malfunctions, and wear and tear of various items. 

    Here are some typical inclusions:

    • Home appliances including dishwashers, microwaves, ovens or ranges, refrigerators, washers, and dryers 
    • Other appliances or systems such as smoke detectors, instant water dispensers, central vacuum systems, ceiling fans, and doorbells
    • HVAC systems including air-conditioning, heating, electrical, and plumbing systems 
    • Septic systems or wells 
    • Pool and spa equipment
    • Roof leaks

    These are the most typical things that are covered, but there are different types of additional coverages available. You just have to customize a plan that will work for your home and its needs. Not everything is covered, so you have to thoroughly review your company’s policy and choose the coverage that makes the most sense for your home, your budget, and your needs.

    How much does a warranty cost?

    The cost of a home warranty depends on your provider, the things you want to be covered, and the level of coverage you choose. According to Consumer Affairs, the average cost of a general package starts around $300 up to $600 a year. For comprehensive coverage, HomeAdvisor estimates approximately $885 yearly for a warranty that includes $20,000 worth of protection. The price increases when you include add-ons, such as coverage for a swimming pool or other external appliances you think you will often use.

    You also need to factor in service fees each time you file a claim with a home warranty company. They may charge you $50 to $100 per visit, depending on the plan you choose.

    Do you need a home warranty?

    Once the home inspection is completed on your new home, you should request a copy of the report. Read through the findings to see if there are areas that are recommended to be repaired or replaced in the near future. For example, if the findings indicate “you have 3-5 years left on the boiler,” “the water doesn’t heat fast,” or “the roof will probably need replacement in the next 2-4 years,” it may benefit you to consider a home warranty. These costly types of repairs are things that most homeowners don’t plan ahead for, so having a home warranty can alleviate the financial stress of making larger-scale repairs. 

    Like all warranties, buying a home warranty protects you against expensive, unforeseen repair bills and provides peace of mind. However, it’s not just the larger costs that creep up – if you are not a handy, DIY-type homeowner, smaller projects can add up over time. Imagine having to repair multiple smaller things over several months – that is time and money that adds up. Having a home warranty can give you the convenience of making a single phone call if something breaks or needs repair versus searching for, calling, and scheduling repairs by other professionals. 

    Pros and Cons of a Home Warranty 

    PRO: Peace of mind

    Even the best-prepared new homeowners may face many unforeseen and unplanned expenses. Having a home warranty can give you the peace of mind that if a major repair is needed, it’s simply a phone call away to fix. For example, a roof leak can wreak havoc on your home, causing damage to many parts of the home. However, a home warranty lets you push some of that risk and cost to the warranty provider.

    PRO: Convenience

    When you have a home warranty and something in your house breaks, you no longer need to hunt for a service technician, rely on family and friends for referrals, or pull out the tools and repair it on your own. Rather than take time to research your options and get quotes, you can simply call the service company to take care of it quickly and efficiently.

    PRO: Year-round protection

    A typical home warranty policy gives you coverage for an entire year. That means that no matter the season, all the systems and appliances listed in your contract are covered under the policy. Imagine having a central air unit break in the dead of summer or a heating system malfunction during the cold of winter. One phone call to the warranty company means your home will be comfortable once again. 

    CON: No guarantee of Replacement vs. Repair

    While it’s simple to call the company once something breaks, the warranty issuer ultimately decides whether a covered appliance or system should be repaired or replaced. They may send a technician to attempt to repair first before giving the ok to replace a covered appliance or system, and in some cases, they may deny repair or replacement completely. 

    CON: Service Uncertainty or too much wait time

    If you are looking for a quick fix, brace yourself. The wait times can be a little longer, especially if you file a claim by phone. While some homeowners find their providers are responsive and professional, others are disappointed with the speed and quality of work. Research the provider ahead of time to make sure you are dealing with a professional and reputable company.

    Choose a provider with simple, easy-to-understand contracts and review the paperwork thoroughly. Always ask your provider for clarification on anything that might seem unclear before you commit to the contract. 

    Bottom Line 

    Whether you are buying your first home or forever home, if you want the peace of mind that your investment is protected, a home warranty may make sense for you. The convenience of not having to DIY on your own or hunt down a professional service provider and the year-round protection that a home warranty offers is an attractive feature to some new homeowners. However, a home warranty doesn’t guarantee that you will definitely get your appliances or systems repaired or replaced. When considering buying a home warranty, you should thoroughly read your home inspection report and weigh your options against your goals and budget. 

    If you are ready to buy a new home, our team is here to help you on the journey to homeownership! Contact us today to get started! 

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