Have you been shopping around for real estate and finally found a home that you like? If so, you may be caught off guard by the seller offering a home warranty. While it is not a standard offering in real estate sales, it can be a nice perk when buying a home. Here is what you should know about buying a single-family home with a home warranty.
How Warranties Can Offer Peace Of Mind
If you are a first-time homebuyer, you may enjoy the concept of having a home warranty due to being nervous about buying a home. There are many things that you now own that can break, which will leave you with a big bill to pay to get it fixed. This is where a home warranty can offer you some much-needed peace of mind.
A home warranty is going to cover any major appliance in the home that breaks within the timeframe of the warranty. For example, if you have a washer and dryer that does not work, the home warranty can help repair or replace the washer and dryer. If you have an air conditioner that breaks down within the first year, that home warranty can help cover the necessary repairs to get it up and running again.
This can definitely help you ease into homeownership because you won't need to have the cash on hand saved to pay for any of these repairs.
Home Warranties Do Not Cover Everything
Make sure that you understand what the home warranty covers before you take it. For example, it may not cover the shingles on the home since those can be damaged by external factors, like storms. You may have coverage for appliances, but not for things like plumbing or electrical. Sometimes additional parts of the home are covered under an additional policy that adds on to the cost.
Home Warranties Are Optional
If you do not want the home warranty, know that you do not have to take it. Ask the seller about taking the cash value of the warranty and put it towards your closing costs. If the policy is worth $1,000 and you feel like you won't use it, you may be better off getting the cash value instead.
Ask your real estate agent for advice on what to do if the home's owner is offering a home warranty. They can advise you on whether it is best to take the warranty or the value of the policy.