Home Warranties-Are They Worth It?

silver microwave oven on brown wooden kitchen cabinet
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I have a love/hate mindset toward Home Warranties. I love when they save me money and the purchase price was a smart investment. I hate when the unexpected happens and something isn’t covered when I thought it was.

What are Home Warranties? They are policies that you buy for one year to cover any minor repairs needed for your home. I say minor but they cover expensive items like HVAC repair just not items like flooding, fallen trees or disaster damage. Major issues would hopefully be covered by insurance which is completely different and required for your home if you have a mortgage and highly recommended if you don’t!

These Home Warranties expire after one year-or you can buy multiple years for a deal in some cases. You are required to use the contractors they work with for a set service call fee, often $80-$100. These can be lowered if you buy additional add- ons to the policy such as an extra refrigerator, extended coverage for items or even annual HVAC tune ups. Your policy can run around $400- $1000 or more depending how many additional items you add on or if you pay up front to have a lower service call fee.

Last year our garage door motors died days after we moved in to our house. We kept finding that the doors had gone back up after we closed them. My inner Stephen King had several unsettling theories about the cause of this. It was quite simple- they needed replacement. Most companies will repair an item but if it’s no longer available and they can’t get the parts they will replace the item. Our garage motors were 30 years old. Fortunately we had a great service tech because the company was trying not to cover the problem. The service techs they send out work with them a lot and they know what is covered. With his help the situation was resolved in our favor. Really loved that.

Years ago we bought a house that came with a Home Warranty the seller had provided for us. The home was in great condition except everything was quite dated. The aging cooktop died soon after we moved in and we were fortunate we had that policy. We were approved through the warranty company and told to pick out a new cooktop of the same style and brand. Then we were reimbursed. The companies will have different policies for covering your home so make sure everything is approved!! Several months later the built in oven died and we repeated the process with the approval and sales receipt but then the department we sent the receipt copy to denied the claim. Numerous phone calls went unreturned. So I really hated that and it was many years before I trusted a Home Warranty company again.

These policies can really save you a lot of money-3 garage door opener motors were $1200 so that paid for the policy. I like to have a policy just in case I need a fridge repaired because those repairs can be so expensive and I add on a second garage fridge for a small charge. It’s been years since a fridge needed repair at my house but I know if I don’t have a policy I’ll need to call 3 times in one year. That happened when I was mad about the stove and didn’t get a Home Warranty for a few years. I really showed them …

The unexpected can happen. Most companies WILL NOT cover things that have been installed WRONG like plumbing. This is important to note when many homes are being flipped by people watching You Tube and I guess we are supposed to know this years afterwards. Some companies will offer an add-on to cover those situations as well so it’s important to compare the companies and what they cover or will cover for additional charges.

The only negative is if you have a favorite repair person or service agreement for your HVAC you’ll have to use the Home Warranty providers or it won’t be covered. But these people are experienced working with the companies and can be your ally like the man who fixed my garage door motors. I’ve had great service and lousy service but that’s common with everything, even your favorite restaurant occasionally. As soon as something needs to be repaired you either call or go into your online portal and the claim will be updated as it progresses. Many companies will cover your home while it is on the market for sale and then will transfer to the new owner if they want to pay for it or if the seller wants to gift it as a sales incentive especially if the house is dated.

I keep a Home Warranty and I realize there will be some years it doesn’t pay for itself. I will be glad to have a year with no repairs (waiting to have a year like that) but appliance repairs alone are usually worth it for my house since I love cooking. Obviously the newer your home or appliances are, the less need you have for a Home Warranty. Shop around. Talk to your Realtor. These companies have sales reps who can be very helpful with resolution when there is a problem and your Realtor can help you locate that person.

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