Is home warranty needed?

Question

Hello Friends,

Is home warranty needed for a single family home that is going to be a rental unit. We plan to use a management company

My agent sent me a document from an home warranty company before closing and am not sure if we need it.
kindly share your view

Tracey

Account Closed · Answer

when i sell a property, i pay for it if the buyer wants one....on my first home though, i also had the seller pay for one....the one time i had them come out,they said it was obvious the gaspack was old and so it was a pre-existing condition that wasn't covered...long story short..i had to pay to fix the heat anyways...insurance companies, warranties--they're just a joke in my opinion

Nick Henson · Answer

Compare the cost of a home warranty with the value of the peace of mind that a home warranty can provide. (It may be worth it to you to know that if any of the covered systems need repair or replacement within the first year, they will be fixed for the price of a service call fee.)

Tracey Williams · Answer

The seller will not provide one because it's an REO but I just read all the fine print and I wonder what they really cover!!!!!!
I have scan it back to the agent that am not interested since all the appliances will be replaced anyway

Thanks

Steve Babiak · Answer

I don't have any.

There are gurus who suggest using one when you do a lease option, so that the tenant-buyer pays the deductible amounts (so you don't pay anything for repairs in that scenario).

There are just too many things that aren't covered.  This is a form of insurance policy sort of...

J Scott · Answer

First, your agent probably sent that to you out of habit.  Most agents who deal with retail buyers (as opposed to investors) will try to upsell a home warranty because they get a kickback (generally $75-100) if you purchase one through their preferred company.

That said, I'm not a fan of home warranties.  There are too many things that aren't covered, and the things that do tend to be covered are often pretty cheap fixes for an investor with contractor relationships.

But, if you really want to consider it, make sure you read the fine print so you have a clear understanding of what is and isn't covered by the policy.

Adrian Williams · Answer

It wouldn't hurt especially if there are alot of older appliances read the fine print though!!! most of the time they don't cover hvac , keep in mind the agent usually gets part of the warranty fee for selling it to you, you could ask the seller to provide the warranty the reason why the agent probably presented it to you because he/she wants to be the one to receive compensation for it if I were you I would tell your agent to make the sale contingent on the seller providing the warranty , most sellers would be happy to provide a warranty to get the home sold.

Goodluck,

Adrian Williams