There are advantages to offering a homeowners warranty on your home. A Homeowners warranty should be considered an insurance policy to prospective buyers, when it comes to ensuring that the major components of your home, like the furnace or central air, are functioning and will continue to. Part of the reason these are attractive to prospective buyers is that it is like a gift to them, from the standpoint of peace of mind and unexpected replacement costs, when they are first settling into the home.
Most of the homeowners warranty policies are available for a certain term, depending on the premium, the inspection basis of your major components and it is a cost that you have to pay for. It can help your home sell much quicker because buyers don’t have to worry about the possible breakdowns of major equipment that isn’t brand new and they might decide to forego a formal home inspection, which can save the buyer and seller a lot of frustration and expense.
Homeowners warranties usually cover a home’s major systems and most appliances. It offers the sellers the benefits of selling an older home and giving buyers confidence that it is mechanically sound, or at least covered so they don’t have to worry about repairs, as much. It is a negotiating tool that sellers can use to instead of replacing items that buyers might be concerned about breaking down. It can also protect the seller while their home is on the market and protect them from after sale liability because if a system breaks down the day after closing, it is covered and it can’t come back on the seller that they knew it ahead of time.
For buyers, the homeowners warranty will give you a toll free number to call anytime, day or night, no matter what day it is, to get systems or appliances repaired. This peace of mind is an added bonus that many homeowners don’t get, unless they get a warranty with the home. You might incur a small trade service fee for the service contractor coming out, but the homeowner warranty will pay for the repair or replacement of covered systems, appliances and components.
Homeowner warranties can be renewed after closing, when the policy expires, so it is a great way for a homebuyer to continue coverage, with low monthly payments that are easy to budget after the expiration period on the policy that the seller purchases. When it comes to the peace of mind, homeowner warranties offer an easy way to protect against unforeseen breakdowns. Premiums usually cost around $1-$2 per day in most areas, but you will have to talk to an insurance agency that offers the policies in your area to get an exact premium quote.
Whether you are the buyer or seller, it is still worth it to cover older systems and appliances that are out of manufacturer’s warranty. If can help a seller to sell their home because a buyer will be more inclined to purchase a home that offers coverage versus one that is bought “as is”. As long as your systems and appliances are in good working order, you can purchase a homeowner warranty easily and affordably.
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