Home warranties are protectors to homeowners when repair costs are not covered by home insurance. The type of repair costs that might not be covered under your home owners insurance is such things as the plumbing, heating, air conditioning, roofs, and major appliances. Home warranties on the other hand are an added protection against the unknown.
Home warranties are similar to service contracts and typically last one year. Home warranties do not replace homeowner's insurance policies; instead they work together and back each other up. For example, your hot water heater burst and there was considerable damage to several walls in your basement as well as your hot water heater needing to be replaced. The homeowners insurance will cover the damage to your walls and the home warranty will replace the hot water heater. Having both homeowners insurance and a home warranty contract your basement will soon be fixed without you having to take out a loan. You will have a yearly premium for your home warranty which will vary depending on what type of home warranty you choose.
The warranty coverage does not have to be on a new home, in most cases the age of your home will not matter. As long as the covered items in the warranty are in good working condition at the start of the contract it does not matter the age of the items. If your home is in good condition then there might not be a need for a home warranty and you can save the extra expense. Just remember those surprises are usually what causes us the most money. Home warranties have a yearly expense and a service call fee per call. One failing refergerator is worth more than what a home warranty contract is for one year.
When you decide to obtain a home warrant the premiums can be added into your mortgage. Most home warranties are not very expensive. Premiums usually cost about $350 to $500 a year. You will have a service call that is anywhere from $35 - $50 per call. These home warranties can be purchased at closing from the real estate companies. Right at the moment since sales are low in the housing industry some real estate agents are giving one year policies to new home buyers. Home warranties are offered and available to everyone regardless of the age or condition of your house.
As with everything there are the base plans and the premium plans. Premium policies run $150 -$200 more a year and the service call maybe slightly lower. If this is your first time purchasing a home warranty or even if you have had several warranties always do your homework and read the contract thoroughly.
Ask for a complete copy of the contract before you sign and review it with a fine tooth comb. Check to make sure that the appliances and systems that you are most concerned about are completely covered. Make sure there is available service where your house is located. Some warranties do not offer service in rural or even semi-rural areas. If need be call a customer service representative to see what loop holes are in the service availability or response time if you live in a more rural area. An extra charge may be applied for the area that you live in. While speaking to a customer service representative also ask if there is a waiting period or if the contract is taken out January 1 and the stove goes out on January 2nd is it covered? Most generally this is the case and the only thing that you have a waiting period on is 30 days for rust and corrosion.
A home warranty is well worth the $350 - $500 premium per year whether you have a brand new home or an older home. Brand new appliances do not last nearly as long as they use to so if you have new or older appliances then it more than pays for itself if just one appliance goes bad over the year you will have gotten your money out of your warranty. As appliance costs rise every year it is crucial that homeowners protect themselves from this financial burden should a covered item need repaired or replaced.
Home warranties are transferable once a home sells. This brings a level of security to the home's sale. According to real estate experts a house with a home warranty in place sells faster than a house without one. Many new homeowners have already overextended themselves so if the house already has a warranty in place then people do not have to worry about having more money to put out than they were expecting. As a home owner or as a buyer, peace of mind is what you will receive with a home warranty.
Related Articles
Understanding the Home Warranty Process
By: Grant Eckert | 02/12/2007 | Home and Family
Home warranties are not a new product on the market; however they are growing in popularity. The real estate market is cooling off a bit, and many people who are looking to purchase a home are considering what they are purchasing and being more selective.
Why Offering a Home Warranty Can Help Sell your Home Fast
By: Craig Elliott | 02/12/2007 | Home and Family
When you are trying to sell your home, you may notice that the market is quite tough and buyers are expecting more for their money. One of the ways that you can appeal to buyers is by offering a home warranty.
Home Warranty Upgrades-what to Ask for
By: Craig Elliott | 08/01/2008 | Real Estate
When you are looking for a home warranty update, there are probably several things that you are considering asking about and looking for. However, the best way to figure out what you want in your home warranty update is to first look at what is contained there, and then make sure that you have everything included.
Repairs That Can Help Sell your Home
By: Craig Smith | 08/01/2008 | Real Estate
So, you have decided to sell the house. You've found a real estate agency to work with and your price is set. You already have a new home and payments. You want to sell your old home quickly. So, what sort of repairs will help move that house quicker?
The "unique Fixer-upper"-what Repairs are Acceptable
By: Craig Elliott | 08/01/2008 | Real Estate
If you are buying a home that needs a bit of love, then you will want to know exactly what kind of work needs to go into it, and you should insist on a home warranty for the home before you close the deal. The goal with a fixer upper is that you should be able to understand and repair what is wrong with the home, whether that is a leaky roof, a terribly paint job, or moldy carpets.
The Pros and Cons of Selling a Home in "as Is" Condition
By: Stephanie Larkin | 08/01/2008 | Real Estate
So, the house is not in "Like New" condition and is not as cosmetically pleasing as you'd like. Is it worth the time and money to fix it up before selling it? Maybe or maybe not.
Common Mistakes of First Time Home Buyers
By: Stephanie Larkin | 24/02/2008 | Home Security
Buying your first home is exciting. No more rental payments to a landlord making money for someone else. Instead, you are purchasing your own home and investing in yourself. Money paid to your home mortgage is really investing in your future.
How to Protect yourself When Purchasing a Home
By: Stephanie Larkin | 24/02/2008 | Home Security
When you are purchasing a home, whether it is your first or not, it is important that you protect yourself and your investment. Many people will make sure their appliances have warranties, as well as their vehicles.
Got a Question? Ask.
Ask the community a question about this article:
Frequently Asked Questions
Cooktop with a broken dial
By: Sheri_Calgary | 28-07-2008
One of the dials for the cooktop in my house has been broken off. The little metal post that the dial sits on has been sheered off flush with the top of the cooktop. Is there a way of replacing this rather than the whole thing?
Dryer trips breaker in warm months
By: Irishmom | 27-07-2008
In the winter, my dryer works fine ( a little noisy but it heats up and dries ok). In the warmer months, the dryer trips the breaker and there is no heat. Landlord says it's the dryer, friend says it's the electrical wiring in the house. How can I figure out which it is without the high expense of calling a repairman and an electrician?
I was replacing the thermostat and accidentally ...
By: wyman | 20-07-2008
I was replacing the thermostat and accidentally shorted the transformer. What should be the approximate charge to replace the transformer. I feel i was way overcharged for the tramsformer @ $123.73 + labor for total of $212.23. Don't feel as bad about labor as i do about the transformer. Any a/c guy's advise me on this.
Window Air Conditioner
By: Daphne | 17-07-2008
Does anyone have any suggestions on how to get a window air conditioner, specifically a Frigidaire, to blow cold air? I have cleaned the filter and have the cooling knob on high(meaning the highest cool setting) and the temperature knob on max cool. Not sure what else I could do.
HELP
By: jacksonion | 15-07-2008
Air conditioning pressure hi and low side on a 2001 f 150 5.4 eng
Why wont my kitchenaid dishwasher KUDS01DLBL6 ...
By: Deb | 06-07-2008
why wont my kitchenaid dishwasher KUDS01DLBL6 clean the top rack of dishes?
Q&A Powered by:
Latest Real Estate Articles
How to be a Prime Mover
By: Christian Jacobsen | 28/08/2008
Usually the last things out of the old house are the first things you need in the new house; this means moving house should be easy, right?
Wrong!
Chaos reigns on moving day because most of us are more worried about the 'moving-out' side of it and devote our energy to leaving the old home sparkling for the new owners.
We do this, even though most of us have to return to work almost as soon as we are moved in, and we know that the more efficient the move is, the better it is for us.
Chic Rentals Te Ofrece La Mejor Selección En Alquiler De Apartamentos Para Tus Estancias En Madrid
By: David Jones | 28/08/2008
Chic Rentals nace con el objetivo de ofrecer un nuevo concepto de apartamentos Madrid con apartamentos de diseño para estancias cortas y medias en la capital.
Down Market Is Beneficial For Real Estate Investors
By: Prudence Wong | 28/08/2008
A down economy is always a paradise for the buyers to get the dream properties at low price. If you want to invest in the real estate market, this is time for you to invest. Another advantage for the buyer is the low mortgage rates. So both factors favor the buyer, low property price and low mortgage rates. Above all these, the plenty of properties available in the market add the impetus to the buyers
Si Estás Harto De Pasar Tus Estancias En Cualquier Hotel De Madrid, Chic Rentals Te Ofrece La Mejor Selección En Alquiler De Apartamentos Totalmente E
By: David Jones | 28/08/2008
Chic Rentals nace con el objetivo de ofrecer un nuevo concepto de apartamentos hotel Madrid con apartamentos de diseño para estancias cortas y medias en la capital.
Foreclosure Properties Bring Cheers To Buyers!
By: Prudence Wong | 28/08/2008
Even at the time of economic recession one can make real profits from real estate markets. One of the best options for a buyer is to purchase the foreclosure properties. It is a solid investment. You can buy the property and rent it out to the former owner for a specified period.
How To Flip For Cash?
By: Prudence Wong | 28/08/2008
This article defines 3 different flipping strategies to make a gain in real estate investment. Each type of flipping has its own advantages and it will be best utilized when it's based on investment objective.
Unfinished Home - Another Excellent Investment Opportunity
By: Prudence Wong | 28/08/2008
This article describes the benefits in buying unfinished home. When buying unfinished home, there are a lot of surveys need to be carried out in order to eliminate the doubts and to minimize the risk.
Miami Real Estate - Investing
By: Hector Lesende | 28/08/2008
Miami real estate investing is not very hard to learn, even though that there are many facets that are essential to understand before attempting to start investing. While many books and seminars are offered on investing only a few deliver the desired results. Investing is not taught in any university...
More from Stephanie Larkin
Top Five Tips for Traveling With Children
By: Stephanie Larkin | 08/01/2008 | Cruising
Traveling is stressful enough - but traveling with children can be even more so, as anyone who has done so will verify. There are some steps you can take to ensure that your experience is as smooth as possible.
The Pros and Cons of Selling a Home in "as Is" Condition
By: Stephanie Larkin | 08/01/2008 | Real Estate
So, the house is not in "Like New" condition and is not as cosmetically pleasing as you'd like. Is it worth the time and money to fix it up before selling it? Maybe or maybe not.
How to Keep Trees Healthy in Winter
By: Stephanie Larkin | 08/01/2008 | Landscaping
During the winter, extremes of temperature, as well as excess water or periods of cold drought, can be particularly stressful for trees. Preparing your trees for winter, and taking care of them during the coldest months, will help your trees stay healthy and minimize the damage that colder temperatures can cause.
A Quick Guide to Pantry Pests
By: Stephanie Larkin | 05/01/2008 | Home Security
Pantry pests like to eat the same foods that humans do, and finding an infestation of pests in items such as cereals, flour, grains, baking mixes, crackers, pasta, dried fruit, spices and other dry goods is not uncommon. Often several different stages of the pests' life cycles may be present in the infestation, with adults, eggs and larvae present.
A Quick Guide to Fabric Pests
By: Stephanie Larkin | 05/01/2008 | Pets
Fabric pets can cause major damage in the home, to clothes, carpets, curtains and any other textiles in soft furnishings. Preventing moths and beetles from damaging fabrics such as wool, silk, and fur is simple once you learn how to recognize them and the steps you can take to protect your home.
An Introduction to Pet Health Insurance
By: Stephanie Larkin | 05/01/2008 | Pets
As much as people do not like to think about their beloved pets falling ill or getting injured, it can still happen, and treatment can be expensive. In order to provide an alternative for pet owners who fear that they might not be able to afford unexpected veterinary bills, various companies have started offering pet health insurance which can be used much like standard medical insurance would be used to cover visits to the doctor or hospital for the pet owners themselves.
A Quick Guide to Disney Resort Guest Benefits
By: Stephanie Larkin | 05/01/2008 | Flights
Each year, many people who travel to the Orlando Florida area usually spend a few days visiting Walt Disney World. It would be difficult not to, Walt Disney World is one of the greatest theme parks on the planet.
Children's Magazine Gift Ideas
By: Stephanie Larkin | 29/12/2007 | Gifts
Imagine giving a gift that will last longer than the wrapping. Giving one which inspires imagination and brings fun all year long.
Finance 
