Similar to warranties for homeowners, a home warranty for buyers also provide insurance for home systems and appliances. But instead of being for people who already own the property, this type of contract is for people who plan to buy a house.

The Coverage

Home-buyer warranties cover mostly the same things as homeowner warranties. The main contract includes three vital systems: HVAC, plumbing, and electrical. It also includes some major appliances such as the refrigerator, washer, dryer, and dishwasher. But apart from those, you can get additional coverage for many other systems and appliances in your house. The only things you can’t protect in home warranties are structural elements such as the foundation, flooring, walls, windows, and doors.

Home warranties cover services, repairs, and replacements of the items listed on the contract. However, it does not cover the damages caused by the same issues. For example, you can get a plumbing leak fixed for free, but not the mold on the wall that appears because of the leak.

Home Warranty for Buyers Benefits

When buying a new house, most people have no idea about the pre-existing conditions of the systems and appliances in the house. Sometimes, something will break or malfunction not long after the purchase of the property. Repairs or replacements can be costly. Meanwhile, they have recently spent a lot of money to buy the house. Home warranties for buyers can help you avoid such financial distress.

Home warranties should take place within 30 days after purchasing the house. Officers will come to your new house to inspect pre-existing conditions. While most homeowner warranties will not cover pre-existing conditions, things are a little bit different with home-buyer warranties. You can claim a repair or replacement for it if the officers fail to find it during the early inspection.

Home warranties for buyers tend to be cheaper than warranties for homeowners. This is because newly bought houses are usually in better condition than already-settled houses. Hence, the risks for wear and tear are lower.

Having a warranty also means that you will not have to bother with handyman services for any problems in the house. All you need to do is pick up your phone and call the company. Their inspectors and handymen will take care of it.

Drawbacks

While homeowner warranties can be highly beneficial, home-buyer warranties are not always. If the house is brand new, it is very unlikely anything will break. Even without a warranty, the chances are low that you will have to deal with costly damage. Hence, the money you spent on the warranty might be useless.

Some companies have complicated contracts that make it unclear what is included or excluded in the warranty. Sometimes, they even deny claims due to “improper maintenance,” which would be hard for you to prove otherwise. It is also up to the company whether they will repair or replace anything that’s broken. You may not have a say in this.

Each contract usually has a limit of money for coverage. That means you may still need to use your savings for costly damages.

A home warranty for buyers can be either beneficial or disadvantageous. You need to take your time to research before making your decision. Also, it is always crucial to read the terms carefully before signing anything.