Do you have to have a home warranty when buying a house? This is a common question for many home buyers, especially if they’ve never bought a home before. 

Most buyers know they need an insurance policy alongside their mortgage, but not many know whether a home warranty is necessary on top of that.

In this post, our team at Your Home Sold Guaranteed Realty — The Nathan Clark Team will discuss what home warranties do, their benefits and drawbacks, and what to consider when deciding whether to get a policy.

What Do Home Warranties Do? 

Home warranties protect a home’s major systems, like the plumbing, electrical, HVAC, and furnace. They also cover appliances related to these systems, like washers and dryers, dishwashers, ovens, and microwaves.

Sometimes, you can add coverage for additional items, like swimming pools, or other structures on the properties, like guest houses.

Warranties work similarly to insurance in that you pay an annual or monthly fee, usually for a year-long policy. The typical cost ranges from $300 to $600 per year. Then, when an appliance in your home breaks down and needs repair, you file a claim with the warranty company.

The company will send a contractor to inspect the problem and verify that it qualifies to be fixed under the terms of your policy. If it does, the warranty will cover all or most of the cost to repair or replace the appliance, and you’ll only need to pay a service fee to the contractor. 

You can usually expect to pay the contractor $60 to $100. But if the issue requires multiple contractors for different systems, like plumbing and electrical, you’ll need to pay two service fees.

It’s important to note that some home warranties have a deductible-style system, where you’ll need to pay the repair cost to a certain point before the coverage kicks in. 

For this reason, it’s important to read the warranty terms to see what appliances are covered, and by how much.

Do You Have to Have a Home Warranty When Buying a House?

So, do you have to have a home warranty when buying a house? Unlike home insurance, purchasing a home warranty is entirely optional. Whether or not you need one depends on several factors, such as the risks you’re willing to take, the age of your home, and the coverage terms of the warranty.

For example, a warranty may be a valid option if you’re buying an older resale home. But for a newly constructed home with brand-new appliances, it may not be as important. 

New construction homes might already have manufacturer warranties for their appliances, making a home warranty unnecessary.

In addition, you may not need a home warranty if you have your own funds set aside for emergency repairs. Rather than pay a warranty company every month, you can simply add the money to your own fund.

This may be more beneficial in the long run, as it gives you greater control over the repair process. 

One of the major drawbacks of home warranties is that you won’t be able to choose the contractor who makes the repairs. So if you’re unhappy with their service, there’s not much you can do.

In addition, you can’t choose the model or brand of the appliance or appliance parts needed to fix the problem. By having your own emergency fund set aside for repairs, you give yourself a greater degree of control when fixing your home.

Lastly, you should thoroughly read the terms of a home warranty before deciding if you actually need one. Most home warranty companies have a policy in place of not covering items that break due to improper maintenance. 

If you and the company have different definitions of improper maintenance, it can potentially lead to some disputes about which claims get covered.

There are also companies with exclusions for certain items or dollar limits for the amount that can be spent on a particular repair.

Buy a House in New England With Our Real Estate Team

“Do you have to have a home warranty” is a common question among home buyers in New England. If you’re unsure whether a home warranty is the right choice for you, it’s best to consult a professional realtor. They can explain the pros and cons of a warranty for your unique situation and help you find a reputable home warranty company.

At Your Home Sold Guaranteed Realty — The Nathan Clark Team, we have nearly 21 years of experience helping home buyers and sellers around New England, including first-time home buyers. 

Our experience has allowed us to develop a reputation as one of the most successful real estate teams in the area. It also means we’ve created an extensive network of partners, including lenders, warranty companies, and more.

On top of our customer service and industry connections, we also offer several buyer guarantees that make the buying process risk-free and stress-free. This includes our Buy it Back Guarantee and Exclusive Buyer Protection Plan.

To learn more about working with our award-winning real estate team, give us a call at 401-288-3557 or fill out the form below for more information.