What Is A Home Warranty?

What Is A Home Warranty?

You often hear the term “home warranty” when talking about buying a home but what exactly is a home warranty?  Often the term is confused with other warranties and even insurance.  A home warranty is not a builders warranty, that is more related to a structure of the home and provided by the builder on a new home.  Home insurance covers more for incidents such as wind, fire and water damage.  When you think home insurance you can think of more like accidents to the home and contents.

A home warranty on the other hand is more directly related to the day to day appliances and mechanical items of a home.  For example a home warranty typically covers some plumbing, electrical, built in microwave, HVAC, exhaust fan and other similar items you use everyday in your home.  There are extra items you can purchase coverage on that is not typically included in the basic home warranty such as refrigerator coverage, washer & dryer, pool and spa equipment.

So how exactly do you use a home warranty?  When ever you have an issue with the items I mentioned such as the air conditioner you want to make sure you call the home warranty company directly to report the issue.  They will then send out a third party vendor to take care of the issue as long as it is something covered in their warranty.  The cost to you is the service fee, so if the bill comes out to $400 then you only pay the service fee which tend to be in the $60 to $80 range.

Please remember not to call an air conditioner company to fix the issue then expect the home warranty company to pay them.  They have to use their third party vendors they have a relationship with already.  Also keep in mind not all home warranty companies are the same, it is very important to read the fine print.  I find most complaints about a home warranty is due to a misunderstanding of the coverage and this can be avoided by reading the fine print and not making any assumptions of coverage.

With a heart of a teacher I look to educate my clients about the process of buying, selling or renting real estate.  I strongly feel an informed and educated consumer will make better decisions and be less likely to be taken advantage of.

Have questions about this or other topics, don not hesitate to contact me.

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Luis Cuevas, Realtor®

RE/MAX Cross Country

1990 Justin Road

Highland Village, Texas 75077

(214) 783-0535


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