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Buying a home is a huge investment so it is easy to see why home buyers would want some type “insurance” so to speak just in case something goes wrong with the home. A home warranty, while different from actual insurance, protects the home buyer in case certain aspects of the home break down or get damaged.
It doesn’t cover every feature of a home, however, and is usually limited to a year or so from the date the home was purchased. In today’s blog, we will discuss the types of home warranties and why it is ideal to ensure that a home includes one before closing. When it comes to new homes, many home buyers would wonder why they would need a home warranty, considering that everything in the home is brand new. There is a well known phrase can explain why: expected the unexpected. Many things can happen, but as long as the home has a sufficient home warranty then you should be covered. New home warranties will most likely cover everything in the home, along with appliances, for one year. Other structures of the home, such as the roof and flooring may be covered for a longer period.
It is important to be aware of everything the warranty will cover before you close on the property and beware that if a developer does not offer a home warranty then perhaps you should take a second look at your options. Home buyers who are looking at purchasing an existing home rather than a new one still should be aware of the home warranty. Home warranties for pre-existing homes are different from the ones for new homes because they do not cover everything. They also often require a fee for every repair or replacement, similar to a deductible paid for insurance. Another important feature of this type of home warranty is that it does not cover pre-existing problems or any type of structural problems, such as the foundation or roof.
It does, however, cover electrical, as well as plumbing systems and certain appliances, such as a water heater. Because this type of home warranty doesn’t cover nearly as much as one for a new home, it is important to have an inspector go through a home to ensure there aren’t any problems that you will end up having to pay for yourself if you decide to purchase the property. Home warranties can be an extremely beneficial thing to have, in new homes and existing homes alike.
In new home warranties, just be aware of exactly what the warranty covers and for how long. In pre-existing home warranties, do your best to ensure that the property is in good condition and take into account the costs of repairing certain features a home that may be on their last legs. Also be prepared to pay a deductible for any repairs that are covered in a pre-existing home warranty. These fees can be anywhere from $35 to $150 depending on the warranty, but it beats paying the full price of the repairs.
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