A common trend among homeowners,
especially new homeowners, is to purchase home warranty
protection to protect their investment. A home warranty is very
similar to an insurance policy in that it protects the homeowner in
case a covered system or appliance is in need of repair.
There are several companies that offer home warranties, and many of
them now have deals with real estate agents, brokers, and loan
officers to include home warranties anytime a new piece of property is
bought or sold. The fact that home warranties are often included in
new real estate transactions is the reason why they are very popular
with new homeowners. New homeowners are often given this protection
for a year as part of their home purchase, and since oftentimes they
will use the service at least once during that first year, many of
them continue to buy the protection after that first year is up.
Although it varies from company to company and location to location
the standard price range for a home warranty is typically between $300
and $500 per year. Although the first year is usually paid ahead of
time for the entire year, after the first year many homeowners choose
to pay on a monthly basis, normally between $25 and $40 per month.
Particular coverage again varies company to company, but generally
most household systems are covered. Examples of systems that are
commonly covered are the plumbing system, the heating and cooling
system (including the air-conditioning unit), ceiling fans, electrical
systems and exhaust fans. Most policies also include some or all of
the appliances such as the refrigerator, stove, dishwasher, washer,
dryer and microwave.
Most of the home warranty companies work on a national basis therefore
it would be impossible for them to send a repair person from their
company out to each individual's home. Not to mention that each
individual's problem may require a different type of technician. For
example, if you are having a problem with your kitchen sink you may
need a plumber, however, if you're having a problem with an electrical
outlet you'll need an electrician. The way the home warranty companies
handle this is they have contracts with individual contractors in each
city that they have members. When a covered member is in need of
repair they call the home warranty company who then contacts the
contractor in the member's city and schedules an appointment for the
repair. In the event that a covered system or appliance cannot be
repaired it will generally be replaced by the home warranty company by
a new system or appliance of equal value.
All in all home warranties can be an excellent and affordable way to
protect your real estate investment. The average home warranty owner
uses their home warranty service twice per year. Wouldn't you like to
be protected in the event something goes wrong in your home?
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