What Do Home Warranty Companies Do?

What Do Home Warranty Companies Do?

October 23, 2020 Off By Glespynorson

If you have purchased a home, well, ever really, you’ve probably heard of multiple home warranty companies offering their plans to help you with your home. Making choices to ensure that your home is protected and that if things start breaking around your house that you’re as financially protected as you can be. So, you may be asking, what exactly does a home warranty company have to offer you as a homeowner?

Home Warranty Companies Explained.

Warranties in a legal sense within the United States are held to very high standards. A home warranty is a contract between the company and the homeowner for the company to provide discounted repair services and replacement units if necessary. These agreements aren’t typically warranties; they more so resemble a service contract.

Home Warranties typically cover the repair and replacement of certain major home appliances. A lot of companies will cover things like HVAC systems, microwaves, washers and dryers, electrical, refrigerators, and plumbing. These aren’t everything home warranty companies commonly cover, and most companies offer different plans with different levels of coverage.

What’s the Catch?

Many perceptive homeowners are a little wary of home warranty companies because it sounds too good to be true, which is entirely understandable. It’s a good characteristic to be skeptical of things, especially when it comes to financial matters that could directly impact your home.

In most cases, the only catch you’ll be able to find will be in the contract you sign with the warranty company. Some companies limit how much money they will spend on replacement or repair of your unit, or limit the size of units that can be covered or even how many units can be covered. Everything outside of their limitations is something that you’re financially responsible for.

Also, most home warranties only cover items that have broken down because of normal wear and tear and won’t cover anything that broke down because it was poorly maintained. That can also exclude things that are intentionally misused or damaged. Some companies will only cover mechanical items, so if you break something like a knob, handle, or button, that would be your responsibility to fix.

Read your Contracts.

The only way to be completely sure about what your warranty will cover is to make sure you thoroughly read through your contract. Your contract will outline exactly what your agreement will cover. Many companies offer different levels of coverage plans for different prices, so you should be able to find a plan that meets your needs. In the event that the company you’re speaking with doesn’t have a plan that fits your needs, you can always shop around and find a company that does have a plan that fits your needs.

Another common stipulation that many companies use is that they will not cover anything that was a known issue before the agreement was signed. It’s common for real estate agents to misspeak and tell their clients that certain things that show up on a home inspection will be fixed by the home warranty. This is referred to as a known condition in many circles, and that’s another reason why it’s important to read your contract before purchasing a home.

Is a Home Warranty Right for You?

So, you’ve done your homework, and it’s decision time. It’s hard for anyone but you to say for sure if a home warranty is right for you. Still, if you’re good at maintaining your home items and don’t want to worry about having to pay full price to repair or replace them when they eventually break down, it may be a good move for you.