Pros and Cons of Home Warranties

Home warranties are not insurance but they help to make those unexpected costly repairs affordable. if you are considering a home warranty here are some pros and cons.

Pros

Peace of Mind

No one wants to pay a high bill for a major repair. If your new air conditioner compressor breaks, the repair could cost thousands.

Having a home warranty lets you push some of that major repair risk to a warranty provider.

Convenience

When something in your house breaks, you'll probably spend time deciding who to call to fix it. With a home warranty, you can skip that step. Rather than researching your options and getting quotes, you simply call the service company. They'll do the research for you and send someone to take care of the problem.

Budgeting

If something goes wrong you know that you will be expected to pay a service call fee and as long as it is a covered repair that will be it.

Cons of home warranty plans.

Service Call Fees

Though home warranties can cover a lot of repair expenses, they don't cover it all. Typically, every time an incident happens, you'll have to pay a service call fee that may range from $50 to $75. If the issue requires more than one type of technician, you may have to pay a fee to each of them but most home warranties consider that the same service request.

Fine Print

Home warranties are only valuable in the extent that they actually cover the repair or replacement you need. Some things are covered as standard features. Others may be outside the bounds of the coverage, like swimming pool pumps. Or, they may require additional fees for the extra protection.

Also, your claim may be denied if the appliance or system wasn't properly maintained — even if it's covered. The warranty provider may require you to show proof of maintenance. If you just bought a house with a 10-year-old air-conditioning unit that wasn't maintained, the warranty may be worthless.

If you have an older home, you'll want to know if there's a limit to how much a home warranty will pay per incident. You'll also want to ask about code upgrades. If your water heater goes out and you need to bring the system up to new code standards, the costs could be significant. A home warranty may have limitations on the amount it'll cover, or it may not cover it at all. Usually when people complain something is not covered the reality is they are not reading the contract

Service Uncertainty

A warranty is only as good as the company that stands behind it. While some homeowners find their providers are responsive and professional, others are disappointed with the speed and quality of work. People often say how horrible home warranties are but the problem is they are buying the cheapest plan with a non-reputable company.