After all the trauma of seeking your dream home, homebuyers rarely think about what could possibly break and that could cover a multitude of items. As a home seller just thinks of the peace of mind you could have by purchasing a warranty package for the unknown. And what an enticement; purchasing a resale property with a protection plan in place. Homebuyers will be more willing to deal with it. If you are a rehabber selling a home, including 1 year of a Home Warranty plan can be a great incentive!
This can also be a boon to landlords who hold rental properties!
Any unexpected repairs and replacement costs can quickly add up and put a dent in your pocket. With a slow-moving real estate market warranties make homes that are for sale more attractive to prospective homeowners.
Your home could be pristine, kept in an elegant manner but nothing lasts forever. The best well-maintained home will need some form of upkeep one day and most resale homes have some of the original appliances. Homeowners never intend for something to stop working but face it, everything comes to an end at some point.
Home warranties are inexpensive insurance plans that provide specific coverage if an appliance malfunctions. This could mean repairing or replacing the appliance depending upon the type of coverage you purchase. All plans differ including the exclusions and out of pocket fees, so it’s best to compare various home warranty packages.
Typically a home warranty will cover items like:
• Stoves, Ovens
• Garbage Disposals
• Water Heaters
• Washer and Dryers
• Air Conditioning
• *Furnace/Heater (some packages include this as an add-on for an additional fee)
Items that are not usually covered:
• Septic tanks
• Window a/c units
• Garage doors
But buyers beware; each warranty package will include denial of coverage clause; this will apply if the homeowner fails to take proper care of the item. Improper conditions, unusual wear and tear and improper installation will usually negate the contract, however; because every package is different you should pay close attention to contract exclusions.
President and founder of the Colorado Landlords Association, best-selling real estate author and attorney, landlord and real estate investor with 28 years' experience.