Is a home warranty really worth it?

When purchasing a home, your agent will ask you if you want a home warranty.  It is an item on the C.A.R. Residential Purchase Agreement in which the cost is negotiable between the buyer and the seller.  My buyers often ask me if it is necessary.  The answer is no, it is not necessary, but in my opinion, well worth it.  Even if the buyer has to pay for it themselves, it should be done.  And I will tell you why...

A home warranty covers failures of the mechanical systems within the home due to normal wear and tear after close of escrow.  These systems include the furnace, water heater, air conditioning, electrical, attic and exhaust fans, ceiling fans, plumbing, plumbing stoppages and the appliances just to name a few.  The policies are very extensive.  Even though our buyers will have inspections, they never know what will happen after they move in.  I have seen home warranty policies save my clients thousands of dollars in unexpected expenses after they move in.  It is a good idea to pay for the policy through escrow so as a new homeowner, you are all set and if something should break down, simply call the number provided and a technician is dispatched to go out to the property, diagnose the issue and make the repairs.  Often times, when a system cannot be repaired, the home warranty company will replace the entire unit!  My buyers were very pleased to have their water heater replaced just a month after they moved in after it unexpectedly broke down!

These policies can cost from as little as $240 and up to $750 depending on the size of the home and what should be covered.

As the consumer, our buyers always have a choice to pick the home warranty provider that they want to.  I have had great experience with Kristina Militello at First American Home Buyers Protection (415) 407-6412, kmilitello@firstam.com  and I highly recommend her services. 

Here are a few companies that my buyers in Marin and Sonoma have worked with and have benefited from their services:

First American Home Buyers Protection www.firstam.com/warranty

HomeGuard Incorporated www.HomeGuard.com

HISCO Home Warranty  www.hiscohw.com

Related Links

• First American Home Buyers Protection Sample Brochure