There's a lot that can go wrong in a home: broken appliances, leaky pipes, cracked windows, power outages, normal wear and tear damage and more. Ideally, the problems will stay at a minimum, but most homeowners will find it difficult to avoid home repair and replacement projects altogether. When problems surface, having a home warranty already in place can save the day by helping you cover the costs of fixing the unexpected - and surely unwelcome - issues.
Here's what you should know about home warranty plans:
A home warranty plan offers repair and sometimes replacement coverage on home systems, such as heating, cooling, electric and/or plumbing systems. Some plans also cover appliances. If you have a plan and a problem occurs, you can phone the home warranty company and they'll schedule an appointment with a licensed technician to inspect the issue and perform covered repairs.
Keep in mind that a home warranty is not the same as insurance. The latter typically covers a different set of issues, such as fires, property crimes and structural damages. Home warranties are limited to certain components of the home.
Depending on the situation, the buyer, seller or real estate agent may purchase an annual home warranty for typically $300 to $800, depending on the level of coverage, according to Zillow. Many home warranty companies will offer the option to pay the entire cost for the year at once or break it into monthly payments.
Zillow also notes that home warranty plans are typically more applicable for existing homes, as many builders typically will cover appliances, systems and structural defects for a designated amount of time on new-construction homes.
Considering the types of coverage
Home warranty plans include varying levels of coverage, and exclusions typically apply. At HomeServe, we offer separate heating and cooling, plumbing and electrical home repair plans to cover system repairs caused by normal wear and tear. Homeowners can also choose a combo plan for more extensive coverage. In addition, the newly-launched TotalHome Warranty plans from HomeServe (not available everywhere) also offer comprehensive appliance, systems and combination plans.
Understanding the benefits
If you're still trying to decide why you may need to buy a plan, consider this: You won't get a warning when your home systems or appliances decide to break down. When they do, being prepared with a home repair plan affords you the peace of mind that you can handle the repairs - both financially. There are several reasons to buy a repair plan, but ultimately enrolling in a home warranty is a smart decision because you can be prepared for the unexpected.
Asking the right questions
If you're ready to purchase a home repair plan, make sure you know what to look for in an ideal home warranty. Consumer Reports advises considering what kind of coverage you're most likely to need.
As you shop around, asking the right questions will help you make a more confident, informed decision. Those questions may include: