Home Warranties

Designed to Provide Protection for Both the Seller and Buyer
Home warranties – now deemed home service agreements – protect you and your family against financial setbacks from costly repair or replacement due to normal wear and tear of covered appliances and major systems. A Gallup poll reveals that the majority of buyers and sellers rate home warranties as one of the most important considerations when buying or selling a home behind location, design and financing options.
Most basic coverage menus include plumbing, heating and air conditioning, electrical system, water heater and major appliances (range/oven/cooktop, dishwasher, refrigerator, garbage disposal, etc.). Home service agreements are available for single-family homes, condos/townhomes and multi-family units. Additional fees may apply for anything over a fourplex. Optional packages are usually available for the buyer (swimming pool/spa, enhanced HVAC, etc.)

When selling your home, keep in mind the following reasons to include a home warranty:
• Achieve a competitive marketing advantage over homes without a warranty/service agreement.
• Homes with a service agreement result in a quicker sale – up to 15% faster than homes without one – and typically sell closer to the asking price.
• Engaging a home service agreement during the listing period protects your equity investment, reducing your “out of pocket” cost on covered items for unexpected repairs.
Important information to be aware of when purchasing a home warranty:
• A home warranty is intended to provide reasonable and affordable repair cost for the mechanical breakdown of covered eligible equipment due to normal wear and tear.
• The warranty is not intended to replace responsibility for normal maintenance and minor repairs.
• A home warranty does not apply to a pre-existing, non-functioning unit or appliance (example: a non-functioning air conditioning unit).
• Most warranties are for limited service and do not cover everything or necessarily the entire cost of the repairs.
• Payment for the warranty is due at the closing of the property (where allowed by law – yes, for New York State).
• The majority of warranty companies offer annual renewals to the buyer one year from the closing date of the property.
• Most, if not all, warranty companies require prior approval before work is performed by any contractor.
• Normally there is a trade fee (service call fee) due to the contractor upon a visit to your home regarding a claim.

One may think a home warranty is not worth the expense because it does not cover everything. However, statistics show that one to two items will require service during the warranty period, and there is a higher confidence level for both sellers and buyers knowing that out of pocket expenses are reduced on covered items. The ease of use is also comforting with only one contact point available 24/7, in most cases, to register the service request and get the process rolling.

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