A home warranty is a service contract, normally for one year, which helps protect home owners against the cost of unexpected covered repairs or replacement on their major systems and appliances that break down due to normal wear and tear. Coverage is for systems and appliances in good working order at the start of the contract.
How Do They Work?
Who Pays for the Home Warranty?
Now, whether the seller pays for the home protection plan and home warranty coverage or whether the buyer pays for it, will depend on your local customs. It varies. In many locales, it's normal for a seller to pay for the coverage because it's a seller benefit. Why? Because then the buyer won't be calling the seller after closing if something breaks. Many real estate companies offer it to any client they are representing.
How Much does a Home Warranty Cost?
They are fairly inexpensive, typically ranging from $250 to $400, depending on coverage. Home warranty companies sometimes run special sales and either discount policy prices or offer additional coverage for the same price. The policies are prepaid for a year in advance, at which time they expire or can be renewed.
What is Covered?
The coverage usually includes the following items. Also find out if the policy is for the full replacement/repair cost of an item.
What is Not Covered?
What Can Cause Denial of Payment?
Because coverages vary from state to state and from policy to policy, ask to see a sample copy of a policy before you commit.
See below some of the Home Warranty Programs that are available: