WHAT IS A HOME WARRANTY
A home warranty is like insurance, as it covers some or all the costs of replacements / repairs when a system in your home malfunctions. They range in annual costs of $300-$900. Some companies remove the middleman in the repair process. Instead of finding someone to fix an issue, you will directly contact your warranty provider and they will set up the repair /replacement with the appropriate vendors. There are also many companies that allow you the flexibility of finding your own vendor. This allows you to use your favorite contractor (electrician, plumber, HVAC vendor). Your premium usually covers all costs, except for a co-pay which is typically around $100 depending on the repair.
WHY IS IT NEEDED?
If you’ve only rented before, the necessity of a home warranty may be unknown to you. As a renter, you may be accustomed to the landlord making the necessary repairs. All of that changes when you become a homeowner. Now, when the water heater breaks or the fridge starts to leak on the new floors in the kitchen, there is no landlord to call. So, what do you do now? You may have a friend or family member who can handle the smaller repairs, however when it comes to the larger issues a home warranty could save the day.
WHO IS IT GOOD FOR?
If you’re wondering who should buy a warranty, they are usually recommended for first time home buyers who have rented up until that point. When you are used to having a landlord, a home warranty can fill that role in a different way. Home warranties are great for busy homeowners who cannot find time to get quotes for the best repair shops in the area. Home warranties aren’t just for first time buyers, though. If your appliances are nearing the end of their life expectancy, now would be a great time to get a warranty. If all of your appliances were purchased in the same time frame, you don’t want to face the costs of them all failing at the same time. Warranties can save you time and money, especially in the first year of ownership.