When Do You Want A Home Warranty?

When you buy a new home, sometimes you are offered a home warranty to go along with it. In the right circumstances, it could be nice to have a home warranty. Warranties are designed to help you feel better about a purchase. Anytime a seller puts a warranty along with their product, it makes you realize that they are willing to stand behind it. Therefore, home warranties are a good concept overall. However, you do not always need a home warranty. When is the best time to get a home warranty and when should you avoid it? Let's look at a few factors involved with home warranties to help you decide.

How Does It Work?

The first step in deciding whether or not a home warranty is right for you is figuring out exactly what they do. Home warranties are common with builders and some Realtors when selling homes. Home warranties are designed to cover you from having to pay any large repair bills within the warranty period. They cover things like plumbing, electrical, HVAC and more. If something happens to any of those items during the warranty period, the cost should be covered. 

Regulation

One way to decide whether or not you need a home warranty is to check your state laws and see how they are regulated. Some states have questionable regulation while others are not really regulated at all. If you live in one of those states, do not pay any unnecessary attention to a home warranty. If it's free and thrown in with the purchase, fine. If you have to pay for it, you might as well forget about it because it's not worth the paper that it is written on. 

Loopholes

Many home warranties have loopholes in them that homeowners do not know about. If you are actually shopping for one, compare home warranty products against each other. See exactly what is covered and what is not. A common loophole is associated with things that are not directly in the house or under it. If a water pipe breaks out in the yard, this will not be covered by the homeowners warranty. You would be on your own in that case. Another common trick is to say that it was a preexisting condition. If a thorough home inspection was not performed, it could be missed and therefore the warranty company will not pay for it. 

When is it a Good Idea?

Although home warranties are not always in everyone's best interest, there are times when they are a good idea. If you are buying a new house and the builder is throwing it in for free, this is great. It is just an added bonus for you buying the house. 

If you do not like to handle your own repairs or get your own contractors, this is a good way to take care of everything in advance. When something breaks down, your home warranty company will contract with local businesses to fix it. If you do not like to handle these things yourself, a home warranty could be in your best interest. 

 



Can you have two home warranties at the same time?



You could potentially have two home warranties at the same time. You could have a warranty on different aspects of your house. For example, you could have a home warranty that covers the appliances and systems of your house. Then you could have another warranty that covers structural damage. If you tried to purchase two home warranties on the same components of the house, you could potentially do so. However, you would not be able to collect benefits from both warranties if something went wrong. You would be wasting your money on the second warranty.



Do foreclosed homes have the new home warranty intact?



If you purchase a foreclosed home, it could have a new home warranty intact. The home warranty has nothing to do with the fact that the home went through the foreclosure process. If the home warranty is long enough, it could still be in effect. You can also purchase a new home warranty on a foreclosure if there is not one already on the property. In order for your home to qualify for this type of warranty, a representative from the warranty company will have to inspect the property and then determine if it is eligible for a warranty.

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