When purchasing a home, the buyer has the option of purchasing a home warranty plan. A home warranty can help you budget for large home maintenance expenses. Often times buyers have questions about home warranties, here are the most frequently asked questions regarding home warranty plans.
Should You Get a Home Warranty Plan?
What is a home warranty plan?
The standard home warranty plan, or home protection plan, is a one-year service contract that protects a resale home buyer or current homeowner against the cost of unexpected repairs or replacement of major systems and appliances that can break down due to normal usage.
Why do I need a home protection plan or home warranty plan?
According to Old Republic Home Protection Co, a home warranty offers peace of mind, convenience, budget protection, and easy, dependable service. It can protect you from large unexpected expenses, such as A/C repairs.
Is an Inspection Required to Get a Home Warranty?
Inspections are required by some home warranty companies, but not all of them require an initial inspection.
What Happens When I Need Service?
You call your home warranty company or submit an online request if available. A contractor will be dispatched and you will most likely be responsible for a service fee.
Who Handles the Repairs?
Home warranty companies have a network of independent service contractors available. Once you contact your home warranty company they will send out a specialized contractor to assess your problem. You must use their contractors to be covered under the plan.
Do Home Warranty Plans Cover Appliances or System Replacement?
Most home warranty companies do cover appliances or system replacement, check the plan to see exactly what they cover.
What is the Difference Between Homeowners Insurance and a Home Warranty Plan?
Home warranty plans often cover items not covered under your standard homeowners insurance policy. This allows homeowners to fill in a critical gap in protection of your home. Speak with your homeowner's insurance company to see what they do not cover. Then speak with a home warranty company to ensure they cover some of these items.
What do Most Standard Homeowners Insurance Plans Cover?
It is important to speak to an insurance company to find out what a policy will cover. Most homeowners insurance policies will cover damage caused by such perils as fires, windstorms, hail, lightening, theft, vandalism, etc. Typically floods and earthquakes are excluded. Most policies provide dwelling coverage (pays to repair or rebuild your home), other structures coverage (such as detached garages, sheds, fences, etc), personal property coverage (personal items in your home), loss of use coverage (housing and living expense if you have to move out of your home due to damage), liability insurance (protects you if you or your family members are responsible for causing injuries or damage to other people or their property) and additional home coverage (talk to your insurance agent there are certain things you can add on to your policy to provide more coverage).
What is the Typical Term of a Home Warranty Plan and is it Renewable?
The typical term is for one year, however, you can purchase longer terms. Home warranty plans are typically renewable at the end of the term, but please speak with the home warranty plan to make sure your plan is renewable.
Who Pays for the Home Warranty Plan?
Typically the buyer pays for their home warranty plan however sometimes sellers offer a 1 year home warranty plan as an incentive to buyers. Also buyers can request that the seller pay for their home warranty plan in their offer. There are numerous home warranty companies out there so it's best to do some research on which company and plan best fit you. You can visit Old Republic Home Protection's website to learn more and to get a free plan quote: www.orhp.com.
What are the Pros and Cons of Home Warranty Plans?
There are definitely pros and cons to getting a home warranty plan. The best thing for buyers to do is do some research and determine if a home warranty plan is best for them. Some buyers like the peace of mind a home warranty plan provides, while others would rather complete the repairs themselves. Big ticket items like air conditioners can cost you thousands of dollars. If you feel you won't be able to set aside some money for future home repairs, you may consider a home warranty plan.
Remember to speak to the home warranty company and make sure you understand what is covered and what is not under the specific plans they have.
Also, make sure you understand their service fees for sending out a technician and how any repairs will be handled. Some homeowners have run into issues with not properly maintaining a home's system and then they don't understand why the home warranty company won't repair the item. It is essential to understand your responsibilities of taking care of your home as a home owner to ensure an item will be repaired.
Have questions about home warranties or buying a home in general? Don't hesitate to contact Cinda Rose at 623-252-9350. I would love to help you experience a successful road to homeownership!
