A lot of you are watching a lot of tv right now. If so, you probably have seen the commercials for American Residential Warranty and/or American Home Shield home warranty (there are other companies but they aren’t running ads). You may be thinking about buying or selling a home and wondering if home warranties are worth the money.

                Let’s start by looking at what a home warranty covers…and what it doesn’t.

A home warranty usually covers the heating and cooling units (sometimes one-in-the-same), appliances, and (some) plumbing in a home. If, for example, your refrigerator breaks down, the warranty will cover the repair but you will be responsible for a small service call fee.  This can range from $50-$150 per call depending on the plan.  If an appliance is irreparable, a warranty will issue you a check for the average cost. If the refrigerator originally cost $2,000, you will probably NOT receive a check for that amount. Additionally, when a heat pump malfunctions the industry recommends that you replace both the inside and outside units – even if only one breaks – so that one unit isn’t more powerful than the other. However, the warranty will only cover replacement of the broken half.

A home warranty does NOT cover foundation issues, electrical issues, insulation, water seepage, or roof issues (although some plans MAY allow you to add additional coverage). Because of this, I feel it is very important to get a home inspection. The inspector will review all the items that are and are not covered by a warranty. If an item is malfunctioning prior to closing, the warranty will not cover any repairs. But, if you have a home inspection, you can discover any problems and have them repaired.

While many sellers may be hesitant to add any extra costs, I can speak from personal experience that home warranties help a buyer feel more secure in their decision to buy your property.  And if you are buying an older (or even not-so-old) property, the peace-of-mind can save you from the worry of second-guessing your purchase.

In summary, home warranties are worth it – IF you understand them. 

If you have any questions about home warranties (or anything else), I am always happy to help! Feel free to send me an email.

Photo by Alex Qian, Pexels

Published by staceyalleyrealtor

I moved to Harford County in 1993 and fell in love with the area, it's location (so close to Baltimore, Washington, DC, and Philadelphia), and it's people. I have spent over 20 years in the Real Estate industry - mostly educating people so the process isn't so scary.

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