If you have found a home you love and want to live in and successfully purchase it, one of the firs things you will be offered is a home warranty. These kinds of warranty plans provide homebuyer’s protection from repairs that are generally unpredictable and could become quite expensive. While this kind of plan sounds like a fantastic option for protection against the unexpected, there are also certain drawbacks to taking out a home warranty. We will discuss some of the most important pros and cons associated with getting a home warranty for you new property so that you can decide for yourself if a home warranty plan is something you want for your new home.
- Homeowners who do not already have some kind of emergency funds, or want to use the money they have saved for other things. If you are in a situation like this a home warranty can be a great form of protection that will protect in the event of unexpected costs relating to your home.
- Home warranties can also be great if you are not personally handy, as the provider of your home warranty plan will handle the repairs for you.
- If you do not want to deal with the hassle of finding trustworthy contractors a home warranty plan could help alleviate this problem. Home warranty providers will most likely have an expansive network of home repair contractors and will be able to find you someone to make the repairs you need with a lot more ease.
- Home warranty plans also serve as a way to provide homeowners peace of mind and reduce stress so that you are not spending as much time worrying about what might go wrong and stressing about saving money in the event that the worst happens.
- Warranty plans will not provide coverage for items that have not received “proper maintenance”. Defining proper maintenance is not usually very solid, and can sometimes lead to disagreements between homeowners and warranty plan providers. This can become a real headache for you as a home owner in the event that your warranty provider uses the proper maintenance gray area as a way of avoiding valid claims for coverage.
- Neglect by previous homeowners can also cause problems for you as a homeowner with your warranty plan. If certain features of the home were not taken care of before you may find that the damage is irreversible and can not be fixed.
- Warranties usually have a lot of exclusions, which means they may not cover repairs for certain things you need it for in your home.
- Warranties also often have spending limits per repair or per year, so you may not be able to get as much money as you need to make proper repairs to your home.
- If nothing in your home breaks in a year then you will essentially be paying your home warranty premium for nothing. If you had put this money into a personal emergency fund rather than paying a home warranty premium then at least you could of still earned interest on it.