Home owners warranty

4 Replies

I am looking for a reputable and reasonable home warranty compny for my three properties in Pensacola Florida.

Does anyone have any advice, comments, or suggestions?

Thank you

Justin Schwartz

Justin, we've managed hundreds of rentals over the years and I'm unsure if we've  noticed any real difference in the companies.  I don't buy the warranties for my rentals.  I think the bigger question to research would be if they're prudent to buy in the first place.  

If I ever bought a warranty for any of my units, I would only do so for those with old HVAC units.  That being said, my best payoff for one of those monsters was for my primary residence I bought back in Y2K (that acronym's bringing back flashbacks...lol).  The seller provided one for me and in less than six months after closing my HVAC + gas water heater died.  I got some major new equipment for paying 2 tiny service call fees.  

If you find any large home warranty company's with reasonable reviews I'd be shocked. They are generally garbage used to give naive home buyers a false sense of assurance. Many RE agents like to add them on to sales because they are cheap and effectively deceptive

Hey Justin, while everyone else seems committed to talking you out of buying a home warranty, I'll just answer your question as asked.  When I was an active real estate agent (I primarily only invest now), if a buyer asked for a warranty or a seller offered one, I would use/request First American Home Warranty.  I had a number of buyers have problems with warranted items post-closing, and they told me First American was very easy to deal with, and fixed the problems right away. 

For the record, I'm sure you could also find plenty of bad reviews on them, and every other home warranty company as well.  The main reason for that (as explained by the previous posts, which I agree with) is that warranties are set up to make the warranty company money, and typically only 12% of the premium actually goes to coverage, while the rest is spent on operating costs, large commissions for sales people, marketing, etc.  Which means that on average, of your $300 spent per year, only $36 goes to coverage.  I may not be a math whiz, but that's not a very good deal for you.  However, it's kind of like any insurance...you don't want it until you need it...so the choice is obviously yours.  Good luck!

Originally posted by @Matt Robinson :

Hey Justin, while everyone else seems committed to talking you out of buying a home warranty, I'll just answer your question as asked.  When I was an active real estate agent (I primarily only invest now), if a buyer asked for a warranty or a seller offered one, I would use/request First American Home Warranty.  I had a number of buyers have problems with warranted items post-closing, and they told me First American was very easy to deal with, and fixed the problems right away. 

For the record, I'm sure you could also find plenty of bad reviews on them, and every other home warranty company as well.  The main reason for that (as explained by the previous posts, which I agree with) is that warranties are set up to make the warranty company money, and typically only 12% of the premium actually goes to coverage, while the rest is spent on operating costs, large commissions for sales people, marketing, etc.  Which means that on average, of your $300 spent per year, only $36 goes to coverage.  I may not be a math whiz, but that's not a very good deal for you.  However, it's kind of like any insurance...you don't want it until you need it...so the choice is obviously yours.  Good luck!

Thank you so much, this is exactly the answer I was looking for, I was hoping for a better answer that would benefit me in finding a good warranty but it seems as if the odds are more against me. thank you for being so open and thorough!!!

Join the Largest Real Estate Investing Community

Basic membership is free, forever.