How To Eliminate Stress With A Home Warranty

Dated: 09/28/2018

Views: 197

New home sales are steady, existing-home values are rising and credit is easing even with stricter federal lending guidelines. The standard mortgage rate is still historically low.

But properties are still not selling as briskly as many had hoped, the market has flattened, and Sellers and Buyers alike are searching to make a deal at their best advantage.

One way to distinguish your home from others on the market, or to give yourself more of an advantage, is to acquire a home warranty.

Home protection plans cover the costs of repair or replacement for many components and appliances such as refrigerators, washers, dryers, dishwashers, heating, air conditioning and plumbing, electrical, water heaters, garage door openers, and other items.

Research shows that homes with a home warranty sell faster and at a higher price point than those without. Homes with warranties have an average of 11 fewer days on the market and sell for $2,300 more than those without.

Sellers and Buyers both can benefit from the "peace of mind" of a home warranty at a high-stress time when little items can become big concerns. Calling a reputable warranty company, after all, can be easier than finding a qualified contractor yourself.

For Sellers, a home warranty protects their budget during the listing period, as they know they won't be out of pocket for the repair of a major appliance, for example, and it reduces any pre-close issues related to the home inspection.

In addition, Sellers often purchase a warranty as a gift for Buyers because they know it can give new homeowners more confidence in their buying decision.

For Buyers, in addition to basic appliance protection, they can receive repairs and replacements for mismatched systems, along with coverage for undetectable pre-existing conditions, improper installations, and lack of maintenance.

On average, homeowners spend 1−4 percent of their home value on maintenance and repairs. A home warranty offers affordable budget protection against the breakdown and replacement of these home appliances and system components.

There are definite benefits however, costs and other considerations should be factored into a homeowner’s decision to purchase a home warranty.

For one, the cost can range from $385−700 or more depending on inclusions, typically paid by the seller as part of the contract negotiations.

In addition, there is a service fee of up to $100 depending on the warranty chosen. And, if the buyer wants to renew the warranty after one year, it may cost more than it did originally.

Many warranties do not cover pre-existing conditions, as determined by the contractor that handles the service call. Because the home warranty company contracts with the service contractor, replacement parts/materials will be the company's choice.

Finally, additional fees can be charged for removing old units, collateral damage that is incurred, such as fixing a leak behind walls, or code upgrades.

Do your homework. Look for a provider that has a proven track record, is financially sound, has associates available 24/7 and has large network of reputable contractors in your area.

Although home warranties can protect you from unexpected and costly repairs, it’s also vitally important that you read the 'small print.' For example, if the seller's air conditioning breaks down, and it is determined that it was not properly maintained, the home warranty might not replace it.

Overall a home warranty from a reputable provider can be a way to reduce the stress associated with selling a home, and provide peace of mind for both the Buyer and Seller; before, during and after the sale.

For more info or questions, call Barb 404-500-9440.

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