Is home warranty worth it?

4 Replies

Hi All, I have been buying home warranty along with home owners insurance for my rentals but they seem to be eating up my cash flow. Moreover the trade call fee is additional if in case a claim has been made. So, do you all get warranties on rentals or just have a reliable handyman fix things as it breaks? Thanks in advance!

no. save your money. been there done that. None of them are responsive and take a minimum of a week to get a contractor out to your property if at all, causing headaches and requiring constant follow up to check status. Worst contractors are used and they will do the bare minimum. save your money. do a solid rehab up front to harden rental and find a good handyman for in between.

Originally posted by @Jeff Bridges :

no. save your money. been there done that. None of them are responsive and take a minimum of a week to get a contractor out to your property if at all, causing headaches and requiring constant follow up to check status. Worst contractors are used and they will do the bare minimum. save your money. do a solid rehab up front to harden rental and find a good handyman for in between.

 Thanks Jeff! I noticed that my handyman charged about the same or lower than the trade call fee to fix issues anyway. 

Makes me wonder if I should get rid of it for my personal home too 🤔


Home warranties, like many things sold with fear marketing, are bad for the consumers. The commissions paid on them, to the "good natured" salespeople / realtors, etc. are juicy. They're an awful product. I had one provided to me a few years ago. I didn't know I was getting it, until the day of the close and it was too late to ask for a seller credit in lieu of it. Low and behold, the AC died. I thought, ok, free AC? 

Not so fast. The contractors that work for the home warranty companies aren't paid too well, so as a result, they add fluff charges and inflate costs, which the home warranty company does not pay, which gets passed on the the homeowner. 

The warranty cost: about $500. 

My cost for a new AC was about $1500 at the time. 

I had to pay $300 for the permit, a fee for refrigerant recovery, and a few other junk add ons. I ended up paying around $700 in additional fees, most of which were total garbage. 

So, between the $500 for the "warranty" and the $700 in fees, I "saved" $300. 

I've heard of other horror stories with them too, which I won't go into here, but all I can say is the vendors took complete advantage of homeowners that simply didn't know any better. This was their profit center. 

These costs over more units show that it just doesn't work out over time and there's a reason they advertise them so aggressively.