Real Estate Home Warranty,
Is It Worth the Paper It's Written On?
REinfo4me.com
The right home warranty plan can save you on some very costly repairs.
So what's it all about Alfie?
A home warranty is designed to protect the Real Estate Buyer from unexpected and expensive repair bills.
It is also designed to give the Sellers peace of mind by not having someone "dun" them over problems they didn't know about.
A home protection plan is NOT a replacement for simple home maintenance.
A home protection plan is an insurance policy covering certain items for repair (or replacement) in your new real estate purchase.
Like most insurance policies, it comes with a "deductible". The "deductible" is what you are charged for a service call
A service call will cost you anywhere from $30 to $100 depending on your plan and the specific item covered.
O.K., say you have a problem with a stopped up sink or bathtub.
Would you call the real estate home warranty company?
Not necessarily, because depending on the time of day, it might be less expensive to call your local drain clearing service.
A lot of small local companies only charge $25 to $30 to run a "snake" through your drain line. (I am not talking about R*to R**ter here.)
If you called the home warranty company, you would have to pay the service call fee of typically $50!
By the way, the "service fee" is normally only charged if the repairs are done.
If the backup occurred at midnight or on a Sunday for example, then it would be better to call the warranty company to avoid excessive overtime charges!
You have to decide what makes more economic sense.
When you move in to your new home, everything should be in working order.
After all, you did do a walk through didn't you?
See the Buyers section for more info on this.
So what happens if you didn't check everything, and you find the heating doesn't work?
CALL THE HOME WARRANTY COMPANY IMMEDIATELY!
Don't start panicking and try to call the Sellers or your Realtor®!
That's what real estate home warranties are designed for!
What if it's something major not covered by the home warranty?
NOW you go after the Sellers
and contact your Realtor® immediately.
Your Realtor® will help you resolve the issue.
Most "STANDARD" real estate home warranties cover the following:
Plumbing System: pipe leaks and breaks.
Drain Stoppages: and Septic Tank Pumping.
Toilet Mechanisms:, tanks & bowls.
Faucets:, Tub & Shower valves.
Water Heater: & Circulating Pump.
Sump Pump.
Heating and System.
Electrical System.
Dishwasher & Trash Compactor.
Oven/Range/Cooktop.
Built-in Microwave oven.
Exhaust Fans & Ceiling Fans.
Garage Door Opener.
The above list is taken from
Buyers Home Warranty Company®
, a LandAm® Company.
The following are items of OPTIONAL coverage and there is a per item coverage premium involved.
Be Aware that this coverage is available!
Air Conditioning/Evaporative Cooler
Pool or Spa Equipment
Roof Coverage
Well Pump System
Refrigerator
Red Tag Options
Washer/Dryer
Septic System Coverage
So, how do I get a real estate home warranty, who pays for it and how much is it?
Ask your Realtor® about home warranty plans they recommend.
One company I have personally had very good experience with is
Buyers Home Warranty Company®.
Who pays? It is common practice for the sellers to pay as this coverage usually prevents disputes over non working items after the sale has closed.
If the sellers don't offer this, then the buyers can pay, or pay for some of the optional coverage items.
How much and for how long? Standard coverage for the average house or condo runs around $250 to $300 and optional items between $50 and $150.(Prices as of March,2006)
The initial coverage period is for one year from the date the transaction closes.
This can be renewed indefinitely by paying an an annual premium
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