After buying a house, you probably want to relax and not think about forking any more money. Unfortunately, home appliance repair is a reality, and you may have to repair the appliances at the most inopportune time. This is why home owners are encouraged to purchase a home warranty plan. This is a plan that covers some of the major appliances in the home, and pays the cost of repairs in case they are damaged. A lot of states require home builders to purchase a warranty plan for home appliances on all new homes that they build. However, even the owner of an existing house will benefit a lot from this type of warranty plan. Some of the appliances that are indemnified include:
Electrical appliances
Plumbing
Heating, Ventilation and Air Conditioning system
Electrical systems
When you have a home warranty plan, you will have peace of mind. This is because you will not have to worry about how to raise funds in order to repair the appliances in your home. The warranty plan will cover the costs and repair the appliances whenever they break down.
Who needs a home warranty plan?
A home warranty plan is ideal for several individuals. They include:
- A lot of states require home builders to take out a home warranty cover. This is in order to entice a new buyer and to give them peace of mind as they will not have to cover the cost of repairs during their first year in the home.
- First time home buyers are encouraged to purchase a home warranty plans. Buying a home can take a huge financial toll on a person. However, the cost of repairing appliances is also high. A first time home buyer may not know just how much they need in order to maintain the new home, and they may be overwhelmed by the financial obligation. The warranty plan will ease their burden as any damages on the home appliances will be repaired.
- A person who wants to attract new buyers to purchase their home will benefit a lot by buying a home warranty plan. The warranty assures home owners that the cost of repairing home appliances will be taken care of. Most of the time, the seller will transfer the warranty plan to the buyer who purchases the home.
- A home owner can benefit from this warranty plan, even if they do not intend to sell their house. This is because the warranty can also cover older appliances. Therefore, a homeowner who has appliances that are up to fifteen years old, and is afraid that they may break down at an inopportune time, can take out this cover so that they can have peace of mind.
- There are some realtors who buy the home warranty in order to please their clients. This is because a buyer will always have peace of mind when they purchase a home that has a warranty. A seller will also be pleased to work with such a realtor, as they know that the home will attract more home buyers if it has a home warranty plan.
Different types of home warranty plans
There are different home warranty plans for the different clients. They include:
1. The homeowners’ warranty: This is a warranty plan that is purchased by the homeowner of a house that is not for sale. The home owner must have lived in the house for at least ninety days in order to be eligible for this cover. In most instances, this cover will become valid thirty days after it is purchased.
2. Buyer direct warranty: This is for a homeowner who has recently purchased the house. They have to buy this warranty within ninety days after purchasing the home. It will become valid immediately.
3. The seller home warranty: This warranty is available to a homeowner who wants to sell their home. It covers the home during the period when it is listed on the real estate market. It acts as an incentive to home buyers to purchase the home, as the repair of the home appliances will be taken care of. Most sellers choose to transfer the seller home warranty to the buyer who purchases their house.
4. Buyer conversion warranty: This is a seller home warranty that a seller choose to transfer to a buyer immediately after they purchase their house.
5. Renewal warranty contract: The home warranty is only valid for a year. A home owner who likes the services can choose to renew the contract every year so that their appliances are continuously covered.
Factors to consider before choosing a home warranty company
There are so many home warranty companies that promise to deliver good services, but not all of them are right for every homeowner. It is important for an individual homeowner to conduct their own research and to consider the following factors before choosing a home warranty company:
1. What appliances are covered by the warranty? What is the limit of this coverage? Home warranty companies usually have a list of the appliances that they cover. You should read this list carefully in order to determine whether your appliances are covered or not. You should be very careful, as the devil is in the details. If they have stated that they cover air conditioners, and not HVAC, you should ask them just in case the heating system is not covered. You should also ask them about the limits. There are some that have limits that are as low as $500, and this is not enough to cover the repairs of several home appliances.
2. Can I pay for extra coverage? You may find that the appliances you own in your home are not included in the list of covered appliances. You should ask the company whether they will allow you to pay extra in order for the warranty plan to cover these appliances.
3. What is the cost of the warranty? The cost of the warranty is the amount that you will pay every year in order to be covered by the warranty plan. This usually varies from one company to another, and it often depends on the type of house and the location. Most warranty plans cost about $500 a year. There are also companies that will ask you to pay a service charge each time you call them to repair your appliances.
4. Are there any extra fees? You should ask the company whether there are any extra fees that they charge. In order to determine whether the cost of a home warranty plan is worth it, you should consider the total cost of the warranty plus the extra fees. If this total is more than the cost of repairing the appliance on your own, then you should search for another company to work with. However, warranty plans are usually worth it because they cover several appliances, and more than one appliance could break down within the year.
5. What is the company’s denial track record? When choosing a company, try and find out how many claims they have denied. If the claims they have denied are more than the claims that they have accepted, then you should look for another company. The reasons for denying the claims should also be legitimate. Examples of legitimate reasons include improper installation and maintenance and improper use of appliances. They could also deny a claim if they realize that the appliance installation goes against the building codes.
6. Who are the service providers? Most companies prefer to send their own service providers to repair their client’s appliances. You should ask them whether their service providers are qualified and licensed. You should also ask them whether it is possible to choose your own service provider. Lastly, you should find out what course of action is taken in case you are not satisfied with the work of their service providers.
7. Research and find out more about the company’s reputation. Read reviews as well as complaints about the company. Another factor to consider is their claims process. It is better to work with a company that responds to claims within twenty four hours. This is because the appliances that are covered by the home warranty are very essential, and they should be repaired immediately.
Conclusion
If any of your important home appliances breaks down when your cash reserves are low, you will probably be stressed out. A home warranty plan will reduce this stress, as the cost of repairing the appliances will be taken care of. This way, you never have to worry about how to survive without your essential home appliances.