When you buy a home, you want to protect it as thoroughly as you can. A home warranty might help you do that — or it might be an unnecessary expense.
Unlike home insurance, which covers your home in the event of a catastrophe — like a house fire or tornado — a home warranty provides extra coverage on various systems around your home should they require repair or replacement from everyday wear and tear.
Home warranties are relatively affordable, costing between $300 and $600 per year, depending on your area, home size and plan coverage, as well as a flat rate of around $70 when a service provider pays you a visit. It seems like a good deal because, for most homeowners, it is.
However, there are a few considerations. If you want to know how the age of your home, your remodeling plans and more affect whether you should acquire home warranty coverage, read on.
When Was Your Home Built?
If your home was built within the past 10 years, you may not need a home warranty.
This is because most states require builders to warranty a new home’s structural elements for a decade, which prevents construction firms from performing shoddy work for high profits.
These protections cover elements like windows, central air conditioning, plumbing and electrical systems — that is, everything that would likely be covered by a home warranty.
So your new-construction home is likely covered for a few years by this builder’s warranty, and purchasing an additional warranty might not be worthwhile.
When researching when your home was built, you might also look into when certain systems around your home were last updated. For instance, previous owners might have installed a new AC unit and a new water heater just before you moved in. Every appliance comes with at least one year of manufacturer’s warranty, and buyers can often increase their warranty by buying during certain times of year or using certain payment methods. If most of your appliances are still under manufacturer’s warranty, you may not need — for now — a home warranty policy.
However, the opposite is true, too. If your home is older than 10 years and has not received new appliances in some time, you are an excellent candidate for a home warranty. Older homes aren’t covered by any sort of warranty except individual appliance warranties you may have purchased, so if you invested in a fixer-upper, you should strongly consider acquiring home warranty coverage.
Do You Expect to Remodel?
In using a contractor, you should receive much of the same coverage that you would if you bought a new home.
Reputable contractors stand by their work by offering a warranty, which will likely take the form of a one-year, no-questions-asked correction period as well as about five years of warranty, in which you are responsible for proving a breach of contract.
If you expect to remodel without using a contractor — that is, using your own DIY savvy — then you might want to invest in a warranty well beforehand. This will allow you to take advantage of your warranty to update certain elements that do break down over time. In the meantime, you can focus your budget on features of your home that aren’t covered by the warranty, like the rotting deck or the ugly façade.
How Diligent Are You at Maintenance?
As explained above, a home warranty covers the normal wear and tear of various systems in your home. However, a warranty won’t cover you if you don’t demonstrate regular maintenance of your systems.
For instance, if you don’t change your HVAC air filters, if you don’t flush the sediment from your water heater, if you don’t clean your fridge and range and if you don’t prevent clogs in your plumbing, your warranty provider won’t pay for the costs of repair or replacement.
If you aren’t diligent about home maintenance, you should hire someone who is.
A regular home checkup from a trustworthy handyman should keep your property in top shape and ensure that your home warranty remains in effect.
However, you should know that previous lapses in maintenance might also negate your warranty policy. So before you buy your home, you should ask for an in-depth review of the previous homeowners’ maintenance schedule. If there are any indications that they weren’t meticulous in their maintenance, you might want to discuss your options with your home warranty provider.
A home warranty is a good investment — for some homeowners. For others, it is a needless expense while they are covered by other types of protection.
You should take the time to look into your property’s coverage, so you can decide whether to invest in a warranty today.
