Home Warranties

One of the worst times to have to put out money for repairs to your house is when you first purchase the home. The settlement table has already drained your pocketbook but how could you have avoided this situation? Home warranty.

Home warranties purchased at the time you're buying your house are a great way to avoid high repair bills in the first year of purchase.  Are they perfect?  No, but they're better than having to foot the entire bill out of your new household budget.  Some of those repairs can get pretty expensive.

As long as the repair wasn't a pre-existing condition when you bought the house most warranty companies are going to cover the repair expense with a small deductible.  Most deductibles range from $50 - $100.  For example, you can't buy a "fixer upper", buy a $400 home warranty and expect them to replace thousands of dollars of defective equipment.  That's just not going to happen. 

The mechanical systems of a house are going to fail at some time.  It could happen a week after settlement or ten years, the key is something is going to fail at some time.  There are life expectancies for everything in your home.  HVAC, hot water heater, appliances...everything will eventually fail.  The home warranty seeks to cover most or all of the replacement expense.

Most home warranties are good for one year after the purchase of a home.  Prices range from about $400 - $500 for basic coverage.  This doesn't include pools, wells, septic, etc.  Some companies offer well coverage for an additional fee.  Read your warranty coverage carefully before you buy.  Most real estate brokers offer warranties from several different home warranty companies and each have different coverage details.  At the end of the one year home warranty period you can renew for another year directly with the home warranty company.

Many buyers agents will try and negotiate that the seller will provide a home warranty when an offer is prepared.  This strategy works most of the time, especially in today's Annapolis and Bowie real estate market.

Home warranty's are like an insurance policy.  They just sit in the background and are useful only when you need them.