Home Warranties
Are you questioning if a home warranty protection plan is for you? Well, you’re not alone. Many home buyers and sellers wonder if a home warranty is money well spent or just money spent with no return. Basically, it’s a one-year service contract that begins on the date of closing which covers certain home appliances and systems that may break down over time.
Benefiting Both The Buyer And Seller In A Real Estate Transaction
Sellers should consider a report by , which showed that homes that came with warranties sold 11 days faster than homes without an offer of a home warranty. Furthermore, the average price was $2,300 higher than those that didn’t include a home warranty with the purchase.
As a seller, a home warranty can act as an effective marketing tool that provides buyers with additional confidence in their purchase. Home warranties appeal to everyone, but first time buyers especially. No one wants just to get settled into a home to find that they have to shell out a large sum of money to fix an appliance. Whether it’s an oven, water heater or another type of appliance or home component, a home warranty can protect against costly repairs that the homeowner would otherwise by liable for.
What A Home Warranty Covers
When you purchase an existing home, it doesn’t come with any warranty. Whereas, some newly built homes come with a one-year warranty on systems and appliances. Homeowners insurance covers the contents of your home as well as the house itself, in case of theft, fire or other damage. But, it won’t protect you if your refrigerator quits. That’s where a home warranty comes in. The vast majority of home warranty companies offer 24/7 customer service assistance. A basic home warranty averages between $350 to $500 with additional fees for extra warranty protection.
In shopping for a home warranty, you will find that the warranties vary from company to company. However, most companies cover the following items:
• Sump pump
• Garbage disposal
• Kitchen appliances (dishwasher, built-in microwave and oven)
• Plumbing
• Heating and electrical system components
• Exhaust fans and ceiling fans
Let’s review typical costs when repairing or replacing home appliances:
• An oven/range can cost on average $114 to repair or $782 to replace
• A heating unit can cost an average of $390 to repair or $2,885 to replace
• The main electrical panel costs an average of $311 to repair or $605 to replace
*The above estimates were provided by .
Often homeowners don’t have a reserve repair fund set up should a major appliance or other home-related expense come up. This is why a home warranty plan can provide a sense of protection and less money out of your pocketbook should a problem arise with one of the home’s major appliances or systems. In order to gain a home warranty, the age of the home is not factored into the eligibility and nor is the appliances or system components. The only requirement is that the items being covered by the warranty must be properly maintained and in good working condition when the home warranty coverage is purchased. sell your house
In 2013, the Chicago Tribune reported that 3 million homeowners purchased home warranties. As with any type of warranty coverage, it’s important to review the terms and conditions in order to understand better what is and isn’t covered. You’ll find that most home warranty policies have around a $100 deductible or the cost of the repair, whichever is less. Home protection plans can be beneficial for single-family homes, condos, townhouses, and duplexes, as well foreclosure and short sale properties. By having a home warranty coverage, you can sleep easier knowing that protection is provided should an unexpected expense come up.
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