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Home Warranty: A Bird’s Eye View

SG • August 1, 2024

To Cover or Not To Cover Your Major Appliances or Home Systems...


When buying a home, it could be beneficial to have a home warranty to assist with the cost of repair, replacement, and service of major appliances and systems. 


A home warranty can be purchased by anyone. Anyone, be it a homebuyer, seller, or renter, regardless of the home's age or condition, can directly purchase a policy from a home warranty company. It’s just a matter of incentive, why might a seller or buyer want to purchase a home warranty?


A Seller's Incentive

A seller may purchase a home warranty as an incentive for a buyer or to ensure coverage is provided if a major appliance or home system breaks before closing on the house. It’s important to note that less expensive appliances like (countertop microwaves and ice machines) are not covered under these warranties.


In the case of a sellers’ market, the buyer will typically pay for the home warranty and choose what type of plan they desire and whether it will cover both large and small appliances and major home systems.


It’s important to note that coverage is limited to what is listed in the contract, different plans cover different appliances and systems. It is vital to pay close attention to what’s covered when deciding whether to buy a home warranty. 


A Buyer's Incentive

Buyers will sometimes ask the seller to pay for the first year of home warranty. For sellers, this is beneficial as the buyer will likely be less concerned about the condition of major appliances and systems, which increases the chance of closing the deal. Meanwhile for buyers, the benefit lies in the peace of mind given, knowing that expensive service or repair costs for major appliances and systems are unlikely. 


The buyer will also be able to access the home warranty company’s pre-vetted contractors. This is very beneficial for moving to a new area or if the buyer does not already have a group of trusted contractors.


Ultimately, a buyer may want to purchase a home warranty if they’re not prepared to spend thousands in the event of a major break down or would like the peace of mind knowing they’re protected as well as the repair process being simplified with the home warranty company involved. 


Need help finding a reputable home warranty provider, contact me!


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