When you are moving into your new home, there are lots of things to consider. Whilst you are doing this, there can be nothing worse than something not working, like your air conditioning. If you have no experience in DIY, then this can become an expensive addition to your new home.
Purchasing a home warranty plan can help you alleviate some financial burdens. You will have to pay it upfront, but it can help you save. Here is a little advice for you and your home warranty plan.
What is it?
You can spend a lot of time researching home warranty plans. Read reviews of home warranty plans to work out if a company is trustworthy. A home warranty is a service contract that pays the cost of any repairs that you need. This can include major kitchen appliances from plumbing to electrical.
It should be noted that it does not cover exterior features like windows, doors, or structural features. Equally, it tends not to cover small or freestanding appliances like countertop ovens. Your agent may recommend a home warranty because their firm has a partnership with it but don’t feel obliged to get that one.
Homeowners insurance covers losses that are incurred within your home. This can include belongings that are damaged in some way, like a fire or through theft. It protects you financially from damages to the home and its contents, whereas a home warranty is a service contract that covers only specific items. Importantly, a home warranty is not usually required by mortgage lenders, while homeowners’ insurance is typically needed before you can secure a mortgage.
Is it worth it?
The cost of a home warranty ranges from around $200 up to around $2,000 per year, according to the latest statistics. If you want to cover more things like washer dryers and septic systems, then it can cost more. On top of this, you may be expected to pay a cost for service calls.
This can range from around $75 to $125, depending on your provider and the type of issue that you have encountered. Though without one, you may end up spending more money and also have the hassle of finding someone to come out and repair your systems.
Do you need a home warranty?
If you are buying a previously owned home, then you may want to consider a home warranty, especially if your initial surveys reveal that some of your appliances are coming to the end of their life. However, you need to read over the terms and conditions of your home warranty, so you know what is covered and how long your coverage lasts. When you are doing this, you should ask for a maintenance history of the major components of the home.
When you are purchasing a home, it may be worth investing in a warranty. There is little downside to doing it for the first year as you can get much of the maintenance you require completed straightaway. You can always cancel it if you don’t want it or need it.