It amazes me how many times this simple item is forgotten during negotiations of a purchase and sale of a home.
Studies have shown this one item may help your home sell faster. It’s a great way to get buyers off the fence and gives your broker one more advantage over other sellers in the area. For home buyers, this one item can save you thousands of dollars after purchasing a home, making it a potentially valuable commodity for both parties.
It’s called a home warranty.
Home warranties seem to be an easily overlooked item, but can be a savor in today’s market where distressed homes are selling “as-is” and older homes are changing hands.
One of my home buyer customers used their warranty to cover a microwave panel, fixed a garbage disposal, clogged toilet, leaking shower and faucet. These repairs would have cost the buyer $3000, but were covered under their home warranty that was purchased during the sale of the home.
I have found most sellers don’t know this, but some warranty companies will cover your home during the listing period and will make repairs if an item needs to be fixed. This may also include items that fall under the home inspection during a sale of the home.
I had another example where a seller of mine had a furnace problem during an inspection and the warranty company corrected the issue. Depending on the company, the cost of the warranties will only be charged at the time of closing, so most of the time it’s a great deal for the seller.
For a few hundred dollars on a major home purchase, buyers and sellers can protect themselves against potential unforeseen issues. Typically there is a deductible that needs to be paid for a service call, but it can be well worth the cost.
Read the contract prior to accepting any home warranty plans since coverage and cost for each company can be different. Your local Realtor can guide you in the right direction to find the home warranty that fits your needs, price and terms.