Home Warranty Service Agreements are excellent tools that can cover the repair and replacement of certain systems and appliance failures that occur due to normal wear and tear. Each year, there’s a 68% chance that a major system or appliance within a home will fail, making a Home Warranty Service Agreement a smart choice when it comes to protecting a homeowner’s important investment.
A common misconception among homeowners is that their Home Warranty Service Agreement and homeowners insurance policy are similar. Buyers should understand that a Home Warranty Service Agreement doesn’t insure against losses, and that it only covers the specific systems and appliances listed in their agreement which fail due to normal wear and tear. Their home insurance policy kicks in after a theft, a large storm that causes damage to the home, a fire, and certain natural disasters. These policies are typically mandatory per the bank issuing the homeowner’s mortgage.
A Home Warranty Service Agreement covers important systems, like the Heating, Ventilation, and Air Conditioning (HVAC) system in a home, or major appliances like the refrigerator or oven. If one of the covered systems or appliances stops working the homeowner can use their Home Warranty Service Agreement to have an authorized, independent Service Contractor come to the home and diagnosis the failure. However, it’s important that buyers also understand the limitations of the Home Warranty Service Agreement.
Homeowners are often disappointed when they learn that a breakdown in their home isn’t eligible for repair or replacement, with the HVAC unit being a common breakdown that may not be covered in full. Home inspectors are not qualified to fully inspect the HVAC unit and buyers often do not realize there may be issues that were not identified during their home inspections.
I partner with 2-10 Home Warranty which offers a program through which buyers can order a full certification of the HVAC unit by a HVAC technician during their inspection period of the contract for minimal cost. Once the unit is inspected and certified, the unit is fully covered under the Home Warranty with no pre-existing condition exclusions. If it fails the inspection, my buyers are in a position to request the needed repairs be made by the seller.
There is a difference among home warranty companies and my goal is to educate and inform my buyers to gain the most from their policy.