Home Warranty - Suggestions

[Nick1994]

I know, I know, these warranties aren't always a good idea.

Looking for advice for a coworker. He's buying a house and wants a home warranty. He isn't super handy, so I don't see him fixing everything on his own, would like more of a peace of mind.

How does it work? The home inspection is tomorrow, is now the time to get one? Any suggestions for companies, and those to watch out for?

 

[rubberchicken]

Originally Posted by Nick1994
I know, I know, these warranties aren't always a good idea.

Looking for advice for a coworker. He's buying a house and wants a home warranty. He isn't super handy, so I don't see him fixing everything on his own, would like more of a peace of mind.

How does it work? The home inspection is tomorrow, is now the time to get one? Any suggestions for companies, and those to watch out for?


I do the website for one of the big players in home warranties, but honestly I do not know how the business works. They sell policies, and the claims side is fed back to the company. I would consider making the seller include it in the deal.
He should price out the policy on a comparable home to see what the cost is, so he knows how it impacts the deal. My thinking is that it is a buyers market right now.

 

[97prizm]

A couple of home warranties that advertise mid afternoon on a few tv channels have received terrible reviews. If it's anything like homeowners insurance you'll have to pull teeth to get stuff covered.

 

[ABN_CBT_ENGR]

Originally Posted by Nick1994
would like more of a peace of mind.

How does it work?


He wants "peace of mind" tell him to forget about even the thought of a home warranty and never allow it to be brought up again.

Unfortunately, been involved with a few from friends who came whining for help.

They are not legal "warranties" ( selective play on words)- they are SLA ( service level agreements) where you pay forward on future repairs.

That's another selective play on words because you better read exactly what's covered ( what isn't) and any prorate requirements as well as arbitration. ( not to mention HOW its covered and what limitations/conditions may apply)

Then see about the totality of the job and quality ( parts? parts and labor?, shipping?, used parts? warranty on the repair work?)

Then check the "repair or replace" policy ( theres a good one and about blending a partial repair into existing work unless you like highly visual patchwork)

Is the company bonded ( or you lose your money if they leave)

Tell him to put about $50 a month into a dedicated checking account for home repair and don't touch it except for repair- that's the best warranty company he can get.

 

[Andrew1972]

These warranties to cover systems (AC, well pump, appliances etc).

My advice stash the equivalent of 1% of home / 12 per month you can easily self insure it.

 

[Mainia]

Originally Posted by madRiver
These warranties to cover systems (AC, well pump, appliances etc).

My advice stash the equivalent of 1% of home / 12 per month you can easily self insure it.


+1 And spend a lot of time finding a good handyman from friends and family, so you don't need to pay $100 PLUS and hour for simple work. Have him watch home shows and Youtube videos and make an effort in learning simple repairs now that he has big boy boots on as a home owner.

 

[dlundblad]

We bought our house Fall 2018 and didn't get it.

Wouldn't have needed it so far aside from the dish washer, which we knew going into it was OLD as well as the exhaust pressure switch on our furnace. I'm handy, but I couldn't have diagnosed that myself. Plus, the guy had the part.

I thought our realtor said what they had to offer only lasted 2 years?

 

[Mr Nice]

Originally Posted by 97prizm
A couple of home warranties that advertise mid afternoon on a few tv channels have received terrible reviews. If it's anything like homeowners insurance you'll have to pull teeth to get stuff covered.

Yep.

Stay away.

 

[Gebo]

From my knowledge, they always seem to come up lacking. I would pass.

One big issue I witnessed was when someone I knew needed to use his warranty he didn't get to
choose who made the roof repair. The warranty company ended up sending 2 different companies but they
didn't get his leak fixed. With his home warranty, the warranty company chose who got to come and do the work.
I'm just guessing but I would imagine that a top quality/experienced repair man would not be a part of a warranty program????
I would assume a warranty program would shop around for the cheapest bidders.

He went on and got his own repairman and paid out of his own pocket to get the leak fixed.

 

[Eddie]

A good local real handyman would be a better investment I think. Ed

 

[RTexasF]

Here in Texas the seller usually provides the home warranty. It's not required but generally part of the deal. Our home came with one and it was a joke. In a smallish town the repair people have to come from a larger city as the locals want nothing to do with the warranty folks due to getting stiffed in the past. We made one claim....fella came out, said he couldn't fix it, then we were charged with a service call by the warranty company. We were told there was no charge involved until we got a $hitty letter demanding payment. Useless in our situation, just caca on paper and aggravation.

 

[FabricGATOR]

ALL insurance is a ponzi scheme and should be avoided.

About the best plan I heard of was kinda like a Baptist health co-op.
Basically everyone in the 'plan' shared the health care expenses with everyone else. Of course this is communistic...

So, back to that other thing, go figure, I think they should save and self insure.

Like these extended auto warranties that I get four robodials a day, the sales pitch sounds like a God send, but in reality, you'd better keep your records and maintenance in order.
I wonder how the argument would go if someone were to claim that they didn't need to follow the Mazda recommended oil changes because BITOG and Blackstone....

 

[walterjay]

I am in business doing repairs to plumbing, well pumps, water heater etc. I absolutely refuse to work directly with any home warranty company. They are difficult to deal with and pay mostly only a small fraction of what they should. I have a customer right now who needs a replacement well tank. It has now been an entire week and the warranty company has yet to commit to replacing it. I replace water heaters and they are typically in the $1,000 range. Many warranty places will only pay the customer $400 for it. And of course there are always exclusions to many things since you did not buy the Premiere Presidential Gold warranty.
When a customer calls me and tells me they have a problem but it is covered under a home warranty I tell them that they the customer must pay me in full and then they get to deal with the warranty company for reimbursement.
Never buy a home warranty. If the seller offers one in the closing package Ok you may get a couple of bucks out of it.

 

[Propflux01]

I had one when i bought my house. Joke. Stay away. I had American Home Shield.

 

[JMJNet]

From what I have read with people in NextDoor app.
Home warranty suppose to cover appliances break down.
However, the claim is always shady as has been described above.
In rare cases, they pay but 95% of the time, the stiff on payment.
In other words, they have unreasonable guidelines to pay a claim.

I agree with saving money away and use that money not only for house emergency but also for any emergency expenses.
Like a self insurance.

In the observation of not being handy, I am not sure but we can always learn.
Youtube is a good resources.

 

[KJSmith]

Stay away as stated by soooo many above.

One point I will bring up...from a contractors point of view.... the homeowner is not the customer, the insurance company is.

Think about that.

 

[Lubener]

Originally Posted by Nick1994
I know, I know, these warranties aren't always a good idea.

Looking for advice for a coworker. He's buying a house and wants a home warranty. He isn't super handy, so I don't see him fixing everything on his own, would like more of a peace of mind.

How does it work? The home inspection is tomorrow, is now the time to get one? Any suggestions for companies, and those to watch out for?

He should suggest to the sellers agent about the seller providing the home warranty. It's very common for a home warranty policy to be included with the sale.

 

[Dwight_Frye]

I would ask the seller to include one in the sale of the home. I had one included in my last purchase and my agent suggested that I include one on the home I was selling.
That said, they are of limited usefulness. My new home was only a year old when I bought it. I had a roof leak a couple months after moving in. The roofer I called to do an emergency repair noted that flashing was missing around the chimney and that was the source of the leak. In addition, the ridge vent that was called for on the blueprints was non-existent.

Old Republic, the warranty company refused to cover the repairs and the fine print on the policy verified it. Luckily I got the builder to reimburse me about $1300 to cover the repair and addition of the ridge vent. I was expecting a small claims case.

 

[WagonWheel]

Originally Posted by Propflux01
I had one when i bought my house. Joke. Stay away. I had American Home Shield.


Same here. They have max payouts so you will likely never get a new appliance/furnace/etc without upcharge. On top of that you are dealing with the lowest bidder trades w/ inconsistent approvals for work make it far from "piece of mind".

I did have a couple positive outcomes with them (it's too random) but the high cost of the policy, $800 to renew + $75 incident, makes it a no-value for me.

The last home I sold the buyer requested credit in lieu of home warranty. Smart.

 

[alarmguy]

Originally Posted by Nick1994
I know, I know, these warranties aren't always a good idea.

Looking for advice for a coworker. He's buying a house and wants a home warranty. He isn't super handy, so I don't see him fixing everything on his own, would like more of a peace of mind.

How does it work? The home inspection is tomorrow, is now the time to get one? Any suggestions for companies, and those to watch out for?


In a lot of markets it would be a seller concession for them to pay for a home warranty. It's definitely worth it if the seller will pay for it.
But no you don't buy a home warranty until you own the home. Typically in most markets you can do that at the time of closing.
You could even buy one after but the above is typical in a lot of markets. Also based on the home inspection report the purchaser can ask the seller to provide the home warranty if it wasn't already negotiated