We all want our homes to last the test of time. After all, these are investments that result from blood, sweat, and tears. The thought of more expenses in the future can be frustrating- that’s why people take up home warranties. But what are these, and why is getting one for your custom home a good idea?

 

Breaking Down Home Warranties

When getting a home, new or otherwise, home warranties are often part of the deal. These are safety nets against costly unforeseen repairs. You see, it’s easy to schedule annual maintenance and put aside money for it. But can you foresee your plumbing having an issue down the line? Would you want the repair costs to come out of pocket? That’s where the home warranty comes in – it pays for these unforeseen expenses, protecting you from financial ruin. It seems easy to understand. But there are more layers to this financial protection.

One thing to note is that a home warranty does not equal homeowners insurance. The latter covers expenses relating to damage to the home and personal belongings due to fire, water damage, hailstorms, etc. So, what does a home warranty entail? – This is a contract between you and a home warranty company that provides repair and replacement services on the home’s major components at a discount. Examples include major appliances like fridges, the HVAC system, electrical wiring, and plumbing.

Does homeowners insurance not cover these major components? Not quite. While the insurance does cover a bit of these expenses, the cost of fixing these components often exceeds the deductibles in the policy. Homeowners often end up reaching into their pockets to cover these added costs, which can be annoying and financially draining. Or they buy additional policies to cover each component at an extra cost.

 

How Do Home Warranties Work?

Most sellers will offer you a home warranty when you are buying the home. Under the agreement, you can get your major home components fixed at a discounted cost. If you like the terms of the home warranty, you can take it up. You can alternatively look out for any mail coming your way as most home warranty companies will come seeking your business once you get a new home.

What happens when something breaks down when you have a home warranty? You contact the home warranty company. These companies work with approved service providers to fix major components in clients’ homes. So, the appropriate service provider for the said component will come a-calling to examine what seems to be amiss. Note that the service provider can only fix what the warranty covers. They break down the costs and complete the job.

Then comes the fun part- you pay a discounted fee because the home warranty company covers the bigger chunk. That’s the beauty of a home warranty.

 

Are Home Warranties Expensive?

You always want to balance the cost of a policy against what it covers. What’s the case with the home warranty? Will you get your money’s worth? Most home warranty companies charge a few hundred dollars per year, which you can pay in one sum or installments. The charges often depend on:

  • The type of property, e.g., duplex, condo, etc.
  • The type of plan- basic or extended
  • The age of the property- newer homes attract higher costs of coverage
  • The size of the house- homes larger than 5,000 square feet often attract higher payments
  • The presence of additional structures- are usually covered at an extra cost

 

Do Home Warranties Cover all Claims?

You might think that getting a home warranty will absolve you from ever using your money to cover repair costs. That’s not the case. The company covers the larger share of the repair costs, and you cover the smaller part. Besides, you also pay a service call fee each time a service provider comes to check out a lodged claim.

Does the home warranty cover all components? The service only extends to components covered by the company or included in the home warranty coverage. You should also note that if a component is not well maintained, a home warranty company could refuse to pay the service costs. So, you would be liable for the service call fee and the repair costs by yourself.

 

Should You Get a Home Warranty?

We now get to the most important question- is a home warranty worth all the hype? Should you get one? If so, what should you expect? Let’s start by looking at the advantages of going down this road:

 

Why You Should Get One

We take out insurance policies for our most valuable assets- cars, health, etc. Why? It’s not because we want something horrible to befall us but because we know we have no control over what happens. These policies give us peace of mind that if something terrible does happen, we will have some form of financial protection. It’s all about peace of mind.

A home warranty offers the same protection. It ensures that if a major component fails in your home, you can immediately get the help you need. You don’t need to go out looking for a service provider and won’t need to pay the total repair costs at once. So, if you want to avoid high extra costs and focus on settling into your new home, a home warranty is a good idea.

 

Why You Might Want to Hold Back

We mentioned that home warranties would not cover components that are not well maintained. You might want to ensure that you and the home warranty company are on the same page on what they will cover. Note that having a home warranty limits the contractors you can use to cover any component repairs in the house.

 

At Hartel Homes, we pride ourselves on building high-quality custom homes that should last the test of time. Even so, we want to protect you against unforeseen risks and costs and advise that you get a home warranty to cover these. Talk to us today about our seller home warranty, and we will be sure to take you through the fine print, so you know what you are paying for.