Purchasing a home warranty is recommended for most home purchases, especially with preexisting homes. Many buy homes expecting them to be move-in ready with no issues. When issues do arise, the new homeowner may feel the seller is obligated to pay for the repair or that they were misinformed about the condition of the home or appliance. These issues can be prevented with the purchase of a home warranty by the buyer or seller.
What Is a Home Warranty?
A home warranty is an insurance policy that can be purchased by either the buyer or the seller, which covers different types of issues with appliances in the home, including repairs and replacement of broken items. Home warranties often cover heating systems, water heaters, stove ranges, dishwashers, garbage disposals, electrical wiring, and small appliances like microwaves. Some warranties even extend to air conditioners, dryers, washing machines, pools and water pumps. On average, a home warranty can be purchased for $350-$1000 per year depending on the extent of the coverage.
Why Purchase a Warranty?
- Having a home warranty included in the purchase of a home can bring more prospective buyers to your property because the buyers know that any appliance issues will be covered.
- If something does break in the home, you will not have to worry about the final buyer asking for you to pay for the repair or replacement of the appliance. This transfers any obligation to repair or replace from the hands of the seller to the insurance company.
- If your home has old appliances, it is more than likely cheaper to purchase a home warranty than all new appliances to make the home more appealing. The buyer can be informed about the home warranty and this can help them see past the older appliances.
- Warranties only need to be purchased once the home is sold. This means you can use money from the home closing to purchase the home warranty.
- After purchasing a home, buyers have often used all of their spare savings in the purchase and they are not planning for the expense of broken appliances. A home warranty can take the extra financial pressure of potential appliance issues away from the buyer.
- Many sellers already include a home warranty within the home sale as an incentive. If there is not a home warranty included, you can ask for the seller to include that in the home price to ensure your purchase.
These are just a few reasons why you should include a home warranty in the sale or purchase of your home. Have questions regarding home warranties? Contact our experts at Eillu to learn more.