The first week of March is National Consumer Protection Week – a good time for consumers to safeguard the biggest investment they’ll ever make, by understanding their rights and protections regarding home warranties.
Unlike homeowners insurance, which covers damages caused by large-scale events or disasters like fires or severe weather, home warranties cover the cost of everyday mishaps – things like a frozen air conditioner unit or a faulty garage door opener.
Typical home warranties cover repair or replacement of a home’s major systems, such as heating, air conditioning, electrical and plumbing and major appliances. Depending on the options selected by the consumer, home warranties may also cover items like kitchen appliances and ceiling fans.
Home warranties are available for both new construction and previously owned homes. They can be purchased at any time during homeownership and are especially useful and popular during the buying and selling process.
Home warranties remove the hassle and risk in trying to find qualified repair contractors. In addition to giving homeowners peace of mind, an investment in a home warranty can increase the value of your property. An industry study of home sale prices found that homes with a warranty sell faster and at higher prices than homes without one. Because warranties can easily be transferred from one homeowner to the next, many buyers appreciate the opportunity to take over the current warranty plan that covers the home they’re purchasing.
As a home warranty purchaser, you have certain rights under law, which vary from state to state. The Service Contract Industry Council has promoted and successfully passed legislation in many states, providing consumers such protections as a “free-look period.” For example, purchasers in Maryland have the option to cancel their warranty plan within 20 days for a full refund.
Homes are often a source of immeasurable pride and comfort. Now is a good time to consider where a home warranty may be the best way to protect it.