Home warranties can save you money by covering repair and replacement costs. However, it is important to carefully review the premium cost and coverage limits before purchasing a plan.
A home warranty is an excellent investment for anyone looking to avoid major expenses that could wreak havoc on their budget and force them to dip into their emergency funds. Here are a few reasons you might want to consider buying a home warranty:
A home warranty typically costs several hundred dollars a year, paid up-front or in installments (if the company offers a payment plan). Some companies also charge a service fee for each call they receive to repair or replace covered appliances and systems.
The type of plans offered and your location affect the cost. Generally, more coverage comes at a higher price, but you can usually find a plan to fit your budget.
Before buying a home warranty, get a custom quote from each provider you’re considering. Coverage inclusions, limitations and terms vary by company. Choose a transparent company that makes a sample contract available upon request or on its website, so you know what to expect from the policy. The long-term savings you gain by having blanket coverage for appliances and systems can easily make up for the initial investment in a warranty.
2. Peace of Mind
Home warranties provide peace of mind that the appliances and systems in your home will be covered against costly repairs. For a monthly or annual premium, you can avoid the shock of unexpected expenses and not have to drain your emergency fund to cover the costs.
Buying a warranty can also save you money on minor surface issues, like a dented dishwasher front panel or scratched refrigerator door that won’t affect how well your appliance or system works. But, be sure to compare coverages, limitations and deductibles before you buy so that you know exactly what you’re getting and paying for.
Buyers may need added reassurance after draining their savings for closing and mortgage fees, down payments, moving trucks and more. A home warranty from a trusted provider can help reduce their anxiety.
3. No Negotiations
Whether it’s included in closing costs or offered to buyers as an incentive, home warranties are a valuable selling point. First-time homeowners can be especially
vulnerable to unexpected repair bills. Their emergency savings may be depleted, and they are likely to be unfamiliar with the age of appliances in their new home.
For sellers in a hot market, including a home warranty as an offer can be the extra detail that clinches a sale. It can also protect sellers from charges levied against them by buyers who find unknown problems months after the sale, and it can help them avoid disputes over the cost of repairs. This is especially important for buyers who waived their right to an inspection.
4. Timely Repairs
The systems and appliances that make up your home are essential to its function and value. Unfortunately, they can experience normal wear and tear and require repairs or replacements over time.
A home warranty helps protect your budget and prevents you from having to dip into your emergency fund to pay for unexpected repair costs. For a relatively low annual premium and service fee, you’ll get peace of mind knowing your home is covered.
When selecting a provider, it’s important to choose one that offers a transparent contract with clearly defined terms, clauses and exclusions. It’s also a good idea to speak with a representative before purchasing coverage. This will help ensure the right coverage options are included in your plan, providing you with a tailored experience and cost savings.
A home warranty may seem like an extra grab for buyers’ hard-earned money at a time when they’re already juggling mortgage rates and negotiating homes. However, it can help them avoid financial stress if something goes wrong with the home systems or appliances.
Instead of having to juggle multiple quotes and contractors or tackle the repairs on their own, homeowners simply contact the company, and they’ll send a skilled technician to fix the problem right away. That can save time and stress, and it also gives homeowners a sense of confidence that the repair will be done correctly.
A home warranty typically costs a small service fee for the technician and covers system and appliance repair or replacement. Premiums, coverage and exclusions vary by company, so homeowners should shop around for the best plan to fit their needs and budget. So the next time you hear someone ask, “Are home warranties worth it?” you will have a lot of reasons why people would want to buy a warranty.