A homeowners warranty is a good idea whether you're buying or selling a house. If you're buying a house, you expect everything in it to work, including any appliances you bought with the house and the heating and cooling systems. You also expect the house to be structurally sound and that the seller disclosed any possible problems with the home. If you're selling your house, you want to make sure that once you sell, you are finished with your time at all involved with the house. You don't want the buyer to contact you the next summer when the air conditioner doesn't work. The way to resolve this issue is with a homeowners warranty. While a home inspector may miss certain problems during the inspection, a homeowners warranty lets buyer and seller know that problems in the home related to the warranty will be taken care of.
What Is a Homeowner's Warranty
A homeowners warranty is essentially an extended service contract. Under the terms of most homeowners warranties, the appliances or mechanical systems that functioned smoothly at the time of the sale are warranted to do so for a set time after the sale. Homeowners warranties generally last for one year but may be extended depending on the wording of the contract. A homeowners warranty can generally be purchased for $300 for homes under 5,000 square feet, which covers most homes sold in the United States.
Homeowners Warranty and the Seller
Such a small amount buys a great deal of peace of mind and also acts as a show of good faith to potential buyers, showing them that you are so confident in the state of your home that you're willing to warranty certain aspects of it for a certain time period. Also, homeowners warranties are generally so reasonably priced that sellers can roll the cost into their asking price.
Homeowners Warranty and the Buyer
Homeowners warranties also provide peace of mind to buyers. If you're purchasing a home but are concerned over certain aspects, particularly the age of the home or appliances, ask the seller for a homeowners warranty. A homeowners warranty can also be a gauge of whether to move on a house or not, particularly if the home is older or if you suspect damage. If the seller of an older home refuses to provide a warranty it might be a good idea to look elsewhere.
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