Home Warranty Tips
If you are purchasing a new home, you will receive a standard builder warranty that will cover the property for at least one year. You will also have coverage on certain mechanical systems or equipment for longer periods. Additionally, some builders provide coverage beyond their required one year period, and this may come directly from the builder or from an outside warranty company. Home warranties, like coverage on other purchases, vary widely in what is covered, the terms of coverage, and the actual value to a purchaser.
Additionally, sellers of used homes sometimes offer limited warranty coverage as an incentive to purchasers and to help them compete with the new home market. If one is not being offered, it’s still possible for you to purchase your own. But you must know that home warranties are not created equal. Read the policy or brochure carefully. While one company may offer coverage for serious structural defects and mechanical systems, another may cover mechanical systems and appliances, but eliminate coverage for the structure. Make certain that the warranty you purchase or receive covers the items that are important to you.
Those purchasing a home warranty should look for the following:
- The name of the company providing the coverage
- The name of the person to whom coverage applies
- The length of the warranty
- An explanation of all items covered by the warranty and which items are excluded
- Whether or not the warranty is transferrable
- Whether or not there is a deductible or base fee for warranty claims
- The procedure for filing claims for service
- The company responsible for making the actual repairs
- The time allotted for responses to claim service
- A clear explanation of how coverage disputes are to be resolved