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Couple months ago, I bought a small forclosure house and seller offers 2 years home warranty. and it doesn’t have any appliances beside a stove, furnece and a water heater. After I turned on the gas and water. I’ve been told that the furnace need to be checked.
The houses has been on the market over 8 months. So the furnace doesn’t work. I called a company to check (cost $ 60 dollor), they said furnace better to be replace, or it will cost lots of money for the furnace bill even after repair. I just relized that my house having 2 years home warranty. I haven’t moved in yet. so I called this home protection company, Cross Country Home Service, which is the seller offers home warranty plan. The plan I heard is about $ 1200 for 2 years. The company asked me co-pay for the estamate fee for checking the furnace. It was $ 75 dollors. After checked, the company told me that was pre-existing problem and refuse to repair or replace. I feel I had been fooled and played by the seller and this CCHS company.

I wondering is it worthyful to buy a home protection plan or home warranty like this. If a home owner had all appliances are new with factory’s warranty, why does home owner buy home protection plan.

If home owner buy 1 year 1 time of electric shock or storm course damage for the appliances. the rate of damage is very lower because we have so many safety plug to avoide that. I don’t see any need for buying the protection plan if this kind of company never cover the cost of repair or replace when the claim costs more than home owner paid for that plan.

From my own experience, I don’t feel it is worthyful to buy a house with home warranty or buy a protection plan for your new house appliances’s warranty. I don’t like this kind of trap. But I would like to hear more about this kind of story, ideas, and opinions. help all of — new homeowners, new home buyers, or potential home owner.

3 Thoughts on Is it worthful to buy a home warranty or home protection plan for a house?
  1. Reply
    MyHandsAreMadeOfPasta
    September 25, 2012 at 3:50 pm

    A home warranty plan is just like any other insurance. It covers the unexpected things that happen and can often save you a lot of money for things that you otherwise couldn’t afford to fix. In my experience the few times I’ve purchased a home I’ve found all the home warranty companies to have a ton of restrictions on what they cover. They are very specific and have tons of exclusions though many can be covered by paying for a higher tier of coverage. Really dude it’s like deciding on any other coverage-it comes down to how much risk you can stomach. A home has a ton of things that can go wrong with it and that can mean potential big bills.

    Each time I’ve purchased a home I’ve made sure to have a home warranty in effect for at least the first year because at no other time will you be so unsure about the working reliability of the components of the home. I take excellent care of my home and never skimp on the repairs so that I minimize future problems. So I usually don’t carry it past that first year but then again, that’s just because of my situation including the quality of the home I started with in the first place. This is a very personal decision you need to make on your own based on what you know about the home and your tolerance for risk. Why not look into just a 1 year warranty? It’s very standard in the industry and I’ve heard some will discount their rates if you talk with them especially for renewals later. Yes they do have copays but that’s also normal with them. But look at your finances and the overall situation with the home and it’s appliances to decide what route you want to go. A good heating and A/C unit replacement can run many thousands so if your warranty covers it-you’re way ahead of the game with only one problem-just one example.

  2. Reply
    Rob
    September 25, 2012 at 4:22 pm

    Sorry u learning a hard life lessons.
    home warranties are worth = zero
    when buying foreclosures.
    as u are learning.
    the seller was misinformed.

    seldom do H.W. pay out or work to
    home owner favor.
    better to self insure. (savings account)

  3. Reply
    figment_usa
    September 25, 2012 at 4:41 pm

    I have had a home warranty on my home since I purchased it 8 years ago. Now that our home is getting older (it’s now 15 years old) I have used the home warranty quite a bit lately, from everything from a stove burner that wasn’t working, dishwasher, built in microwave (replaced and installed by the home warranty company), and air conditioner repairs. Yes, there is a $ 75 co-payment each time someone comes out and my husband could probably fix the smaller stuff, but he’d rather pay the $ 75 to have someone else do it. We are keeping the home warranty because our air conditioning units are getting old and we anticipate them going out soon, which will cost over $ 10k to replace.

    You should look into a different home warranty company. We have American Home Shield and our contract is around $ 500 a year. Also, pre-existing problems are what you are paying them for. They should NOT have a “no-pre-existing conditions” clause in the contract.

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