Setting money aside for repairs vs getting Home/Product Warranty

[Justin Michael Johnson]

Instead of setting money aside every month for repairs, what are your thoughts on using a company such as American Home Guardian who offers coverage for $60/mo. Curious if anyone have done this with success vs setting money aside. Has it payed off being able to forecast $60 for any property? Or is their a catch to this? Thanks! =]

[Bill F.]

I have not done this so take everything I say with a grain of salt. 

If an AC unit or water heater goes out in a rental, I want to replace it and move on. Less hassle for my tenants and me. Dealing with a insurance company (that's what a home warranty is, insurance) delays the process further. This can bite you if the problem is a habitability issue.

Home warranties are designed for people who don't have the means or ability to save enough cash for basic maintenance. Even though you may have used the low and no money down strategy, that doesn't mean you are without cash reserves.

At$60/month, or $720/yr, its three years until you've saved up a not insignificant amount, even more if when you purchased the property you had cash reserves. 

Hope that helps