When was the last time you purchased a kitchen appliance, television, or just about anything with an electrical component at one of your area’s retail stores? What was the first thing you were asked at the register? Would you like a warranty? For that matter, how would you feel about buying a used car without an extended warranty?
Although some say no, many have said yes. We like the idea of a security blanket. It’s called “having piece of mind.”
The question I have is why would anybody buy a home without including a home warranty in the purchase? Sure it adds a little bit of cost to the transaction, but is the cost of not having a home warranty too expensive for buyers and sellers to ignore? It looks like many are saying yes. More than half of today’s transactions involve a home warranty from one side of the deal or the other.
“It is a decision clients have to make,” says John Wilson, broker / owner of Coldwell Banker Traditions.
“The decision is important enough for sellers that we require a signed acceptance or rejection as part of our risk management program
“Sellers are asked at the time of listing their property if they would like their house covered during the listing period. Usually it is a policy that remains in effect for the buyer to use after the sale.”
There are as many home warranty options available as the number of companies making the offer. Coldwell Banker Traditions does not require the use of a particular Home Warranty company, but enjoys a good working relationship with HMS Warranty.
“We have been pleased with their products and services,” explains Wilson, noting that HMS is one of several programs from which a client can choose. “The selection of a particular Home Warranty company is not mandatory. However, making a decision of whether or not to have a home warranty is.”
It should be noted that a home warranty is not the same thing as homeowners insurance, nor is it a replacement for homeowners insurance. Homeowners insurance covers major perils such as fires, hail, property crimes and certain types of water damage that could affect the entire structure and / or the homeowner’s personal possessions. A home warranty does not cover these situations. Rather, it covers specific components of the home.
A home warranty is a contract between a homeowner and a home warranty company that provides for discounted repair and replacement service on a home’s major components, such as the furnace, air conditioning, plumbing and electrical system. It may also cover major appliances such as washers and dryers, refrigerators and swimming pools. Most plans have a basic component that provides all homeowners who purchase a policy with certain coverages. Homeowners can also purchase one or more optional components that provide additional coverage at additional cost.
Home warranty companies have agreements with approved service providers. When something covered by a home warranty breaks, the homeowner calls the warranty company, and that company sends its service provider to examine the problem. If the needed repair or replacement is covered by the warranty, work is completed. The homeowner then pays an agreed upon service fee. Like all warranties, a home warranty is supposed to protect against expensive, unforeseen repair bills and provide peace of mind.
Now, if having a home warranty really brings peace of mind, would you buy or sell a home without one?