Getting it Right: Home Warranties

Buying the right product can be tricky if you have never done it before. Lots of people go to the internet to research their purchases before they buy. No one wants to be put on the spot to make an important financial decision. Buying in haste can usually lead to buyers remorse or is cause for many cancellations and or returns of products or services. Understanding your purchase is key to making sure you buy the right product for your needs.

 

Wrong Fridge

Understanding what you are buying is important! When I was buying my second home I had decided to replace the fridge and went to Best Buy to replace it. I found one I loved for $1200. Then I came across a different one that had a ‘feature’ that I couldn’t live without or so I thought. I was prepared to spend the $1200 on the first fridge, but when I saw the second fridge had a lock feature, I thought this is amazing! My little sister and her two little boys were going to be living with me and if the fridge door locked that would keep them out of my food! I was working with a salesman and I asked about the lock feature he said yep its super simple to use. I then opted for the smaller cheaper $800 fridge because of the lock feature. It was delivered and I tried to set up the lock feature. It was as simple as holding two buttons on the thermostat for 10 seconds and it was suppose to ‘lock’… but the door could still be opened. I messed with it over and over trying to make it work.

Finally I asked my dad for help. He chuckled and pointed out that what was being ‘locked’ was the buttons on the thermostat on the door, not the fridge door itself. Embarrassed I couldn’t believe I bought THIS fridge based only on a feature that did NOT exist! If I had understood what I was buying I wouldn’t have bought this fridge and I would have bought the bigger more expensive one based on my taste. I don’t think the salesperson understood that I was trying to keep two little boys out of the fridge. This feature is more of a bug! I wasn’t thinking that the lock feature was going to keep them from changing the temperature of the thermostat on the fridge. The other fridge’s thermostat was inside the fridge away from the kids, so they wouldn’t be able to change the temperature anyway. Live and learn I guess!

 

What’s Right for You

When buying a house, it is important to research different products and services. Knowing what is best for you and yours is different for everyone. One of the major things I consider when buying a home warranty would be the cost. What is the overall cost annually and if there is a fee for any service calls. You might pay more for a no fee service plan, but if you are on a very strict budget paying a few extra dollar per month may be better than shelling out a $75 service call fee if something goes wrong.

Two words on home warranties: If you aren’t familiar with the product at all – it is essentially a service contract to fix or replace home components like pumps, sewerage, pools etc., as well electronic appliances such as refrigerators, ovens and washing machines. There is an abundance of companies operating across the U.S but each one is pretty much limited to specific states. If you want to find recommended companies in your state you can visit ReviewHomeWarranties.com

 

Customize It

A lot of service plans allow you to add to your plan. If you have a pool or spa you would like to add, you can certainly do so. It will be an added cost, but having previously owned a pool I can attest they require a lot of upkeep! Adding it to the home warranty plan would be ideal.

 

Understand the Coverage

Knowing what is actually covered is important! Knowing the coverage may not actually replace the whole appliance or home system if it breaks. You have to first maintain your homes appliances and home systems. If you are not maintaining them and then one of them breaks the home warranty may not cover the replacement because the homeowner neglected to do the upkeep on the appliance or home system. If you never change the air filter in your furnace and then your furnace breaks down, it could be caused by over working the unit because it was trying to force air through a filthy filter. That is considered neglect on your furnace.

 

Read it Through

Reading the whole warranty agreement through is also important. If you are buying in haste you may not take the time to read through your service plan. You may believe you are buying a service that isn’t what you are expecting it to be. Many people will just list to the sales pitch and decide instead of reading through the whole plan. However the salesperson isn’t the one who is going to be servicing your homes warranty. Take the time and read it thoroughly, ask questions from the home warranty provider directly, not the realtor who is selling the home. They are not going to be held responsible for giving you bad information. It is up to you to make sure you understand your purchase.

If you check out the BBB and any complaints about a home warranty service is usually due to a customer not understanding their purchase. They believe that the service should replace or repair their appliances despite not maintain their upkeep. This is not the case. Had these customers understood what was actually covered they wouldn’t have had an issue with their service warranty. They may not have bought it had they understood what the warranty covers, but it wouldn’t have led to a complaint to the BBB.

There are aggregators of complaints from across the world wide web as well, so you can see the entire picture. Here is an aggregated review of my provider for example.

RECAP

  • Consider your budget
  • Can you customize and add to the plan
  • Knowing you have to upkeep your appliances and home systems for the warranty to be good
  • Read and Understand the Service

Understanding the different between your homeowners insurance and your home warranty can be tricky! Homeowners insurance covers the home incase of fire, theft, storms or other natural disasters.  This is required by your mortgage company to have on your home. A home warranty is optional coverage that will cover the homes appliances and home systems when they break down. Appliances like your fridge, stove, oven, microwave, dishwasher, washer, dryer, and home furnace. You can add additional coverage for other systems or appliances like your spa or pool.

Both of these insurance plans helps homeowners be prepared if something goes wrong and they do not have the money to repair or replace the home or home appliances. This is a financial security net that allows some peace of mind in the crazy world of homeownership!

 

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