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Question:  What is a Home Warranty?

Answer: A Home Warranty (or Home Protection Plan, as it is sometimes called) offers protection for the owner of a property in case of unforeseen breakdowns of major components, such as electrical, plumbing, heating and air conditioning systems and built-in appliances, such as dishwashers, stoves and ovens, garbage disposals, trash compactors, hot water heaters, etc.

Question: Do home warranties cover swimming pools, spas, etc?

Answer: Yes. Most home warranty companies offer optional coverage on swimming pools, hot tubs, spas and Jacuzzi's at additional costs.

Question: Do the plans cover pre-existing conditions? 

Answer: No. A home warranty adds protection against problems that may arise due to normal wear and usage of components after the policy is issued. If there is a pre-existing problem, the owner of the property is responsible for having it repaired at his own expense.

Question: How soon after the policy is issued does the coverage begin?

Answer: With most companies, the policy takes effect right away. But in some cases, if there is a plumbing leak or heating or electrical failure within 30 days, a company may question the timing of the problem, as it may have already existed prior to the issuance of the policy and the company may be hesitant to pay for the repairs.

Question: If I sell my property, am I obligated to purchase a home warranty plan for the buyer?

Answer: No. But for the small amount it will cost you to provide coverage, the peace of mind is well worth the money. By not  providing the warranty, your home becomes less attractive because all you are giving to a buyer is your word that, to your knowledge, there are no problems with the plumbing, heating and electrical components. Also, you may find yourself paying for repairs after the escrow closes or, in a worst case scenario, ending up in court.

Question: If I buy a property and the seller refuses to provide me with a home warranty, can I purchase it myself?

Answer: Yes. In most cases, if the seller is using a realtor, the realtor will tell the seller how important it is to purchase the warranty for the buyer. But it is up to the seller to make the decision to purchase it or not. If he chooses not to purchase the warranty, then the buyer can purchase it himself. 

Question: How long does the home warranty last and can it be renewed?

Answer: The warranty is normally good for a year but some  companies offer extended warranties. Once the warranty expires, in most cases, the property owner can renew it.

Question: Are there any restrictions or service fees placed on the warranty?

Answer: Yes. You should read your contract carefully and  understand what the warranty covers. Different companies offer different coverage's and some have deductibles. In most cases, there will be a service charge each time a technician goes out to make repairs. There may also be additional costs related to specific repairs.

Question: How do I find a company that provide home warranty plans?

Answer: Most realtors use companies that they are familiar with but if you want to do it on your own, you can search the web by typing in Home Warranty or Home Protection Plans. Most offer an (800) number and will refer you to an office in your area.

Note: As with all contracts, read and ask questions. This is intended for general information so contact an attorney for legal advice.

About the Author

This information is provided by John M. Roberts, Broker/Owner of John Roberts Realty located in Rancho Belago, California. He can be contacted at jrobertsrealty@yahoo.com

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