Home warranty for Tenant to use

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Home warranty for Tenant to use

Sharon Zhou
Member since 2022 · 8 posts · 0 votes

Hey everyone, I recently discovered a rental property in my neighborhood that has an interesting listing. The owner has purchased a home warranty and requires tenants to file claims for repairs. This is the first time I've encountered this strategy and I'm curious about your thoughts on it. What do you think of this as a property management tactic?

Quote from the listing: "Owner will cover HOA fees and warranty coverage. Repairs will be made through warranty. Tenant responsible for service charge for each repair (warranty information will be provided). " 

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Greg M.
Rental Property Investor · Los Angeles, CA · Member since 2017 · 2k+ posts · 5k+ votes
2y

So if an appliance breaks down through no fault of the tenant, the tenant is on the hook for having it fixed. 

This is not a benefit, it's a negative for the tenant. 

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  • Greg M.
    Rental Property Investor · Los Angeles, CA · Member since 2017 · 2k+ posts · 5k+ votes
    2y

    So if an appliance breaks down through no fault of the tenant, the tenant is on the hook for having it fixed. 

    This is not a benefit, it's a negative for the tenant. 

    3Reply
  • Charles Carillo
    Rental Property Investor · North Palm Beach, FL · Member since 2018 · 2k+ posts · 1k+ votes
    2y

    @Sharon Zhou

    I would never rent a property with this clause, and I would expect potential tenants to be very wary of it as well. Tenants are tenants, not signing up to be JV partners with the owner. What happens if someone signs it, then during winter, the heat goes out, and the tenant contacts the landlord, and they must go through a lengthy warranty process (that they need to pay for)? No matter if the tenant knowingly or unknowingly signed this addendum, they will report this landlord.

    2Reply
  • Bjorn AhlbladPro Member
    Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
    2y

    Does not work for me as a LL. As a tenant even less so.

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  • Sharon Zhou
    Member since 2022 · 3 posts · 0 votes
    2y
    Quote from @Greg M.:

    So if an appliance breaks down through no fault of the tenant, the tenant is on the hook for having it fixed. 

    This is not a benefit, it's a negative for the tenant. 

    I'm thinking it might be beneficial for LL to manage out-of-state assets for smaller repairs. For large repair or replacement of large appliance, it might not work.

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  • Sharon Zhou
    Member since 2022 · 3 posts · 0 votes
    2y
    Quote from @Charles Carillo:

    @Sharon Zhou

    I would never rent a property with this clause, and I would expect potential tenants to be very wary of it as well. Tenants are tenants, not signing up to be JV partners with the owner. What happens if someone signs it, then during winter, the heat goes out, and the tenant contacts the landlord, and they must go through a lengthy warranty process (that they need to pay for)? No matter if the tenant knowingly or unknowingly signed this addendum, they will report this landlord.


     Never worked with home warranty. Are they this slow? 

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  • Greg M.
    Rental Property Investor · Los Angeles, CA · Member since 2017 · 2k+ posts · 5k+ votes
    2y
    Getting the technician out is not usually a slow process, but getting approval for the repair/replacement can be.

    They will also fix old appliances where it might be in your better interest to replace the appliance. 
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  • Sharon Zhou
    Member since 2022 · 3 posts · 0 votes
    2y
    Quote from @Greg M.:
    Getting the technician out is not usually a slow process, but getting approval for the repair/replacement can be.

    They will also fix old appliances where it might be in your better interest to replace the appliance. 

     Got it. Thank you!

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  • Michael SmytheBusiness Member
    Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
    2y

    Not a well thought out idea.

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  • Bill B.
    Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    2y

    Be ready to pay for the hotel stays when the it takes a week to get water heater or ac unit fixed. Be ready for the extended damage you find because the tenant didn’t call for a repair they didn’t want to pay to fix. And guess what, when they leave you probably can’t deduct it from their security deposit because those wouldn’t be reasonable deductions from their security deposit. 

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  • Bryan F.
    Member since 2020 · 38 posts · 22 votes
    2y

    Call me crazy, but I’d prefer my tenants let me know when a toilet is leaking, sewage is backing up in the basement, or the furnace went out when it’s 0 out. You know who’s likely to make a suboptimal decision on what to do about a property repair? Probably someone who’s never owned a house before.

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  • Emma Atanasoska
    Member since 2026 · 4 posts · 0 votes
    5mo

    This is actually a smart strategy when used correctly. Home warranties can benefit both landlords and tenants. The owner caps their exposure on repair costs, and tenants get a clear, structured process for getting things fixed rather than chasing down a landlord.

    The real risk for landlords is that warranty companies can be slow or deny claims, which creates frustration for tenants and still leaves the owner legally on the hook for habitability. That's why landlords should choose wisely which home warranty company they sign a contract with. 

    Overall, if the warranty covers major systems, such as HVAC, plumbing, and appliances, and expectations are clearly set in the lease, this can be a legitimate way to streamline maintenance management.

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