Home Warranty

What is a Home Warranty?

A home warranty is a service contract between the buyer and the home warranty insurer covering one year, which helps protect homeowners against the cost of unexpected repairs or replacement on their major systems and appliances that break down due to normal wear and tear.

Home Warranty Benefits

One of the key benefits to securing a home warranty is to prevent disputes between buyers and sellers after escrow. The Offer to Purchase Agreement should be used to provide a home warranty policy for the buyer, although the cost may be shifted to the buyer or paid by the seller. This contract offers protection for both the seller and the buyer in that the buyer will contact the warranty company, not the seller should something go wrong with the home systems after the transfer of property at escrow. The home warranty also gives the buyer added confidence in the real estate transaction, as they know that a warranty stands behind the covered systems or appliances in the house. If the systems break down, the buyer is covered for repair or replacement.

Home Warranty Coverage

A typical home warranty protection plan will cover these systems and appliances:

	Electrical System
	Central Heating
	Interior Plumbing
	Water Heater
	Ductwork
	Dishwasher
	Oven/Range/Stove top
	Trash Compactor
	Garbage Disposal
	Garage Door Opener
	Air Conditioning System ( optional)
	Pool Equipment ( optional)
	Spa Equipment ( optional)
	Washer/Dryer ( optional)
	Refrigerator ( optional)
	Roof repairs ( optional)

How much does it cost?

The premium for the policy is normally paid through the escrow and is identified in the HUD 1 Closing Statement. Policies are typically renewable after the first year of the warranty period. Numerous companies offer home warranty protection plans including American Home Shield, First American Home Buyers Protection and Home Warranty of America. The basic policy usually costs between $315 - $400. Options for greater coverage cost more.Most companies collect a service call charge of around $50 every time a claim is submitted.

We recommend you shop for a policy and compare policies with at least two or three companies. The differences in the policy may help you decide which is best for your situation.

Ask these questions:

	What are the dollar limits for individual items and for the entire warranty?
	What is the deductible? Is it per call or per item?
	What is the service charge?
	Can the policy be renewed after the first year?
	Do only licensed contractors make repairs?
	What is the warranty on repairs?
	What is the turnaround time for repairs?
	Which components of the home are not covered?

“As Is” Townhome Buyers Beware!

If you are buying a townhome "as is." The seller may not disclose problems to you by using a property disclaimer. They are not accepting responsibility for the condition of their house. A home warranty policy fills the gap and offers you, the buyer peace of mind. Many sellers offer a home warranty to buyers to make their property more attractive and competitive. If sellers don’t, you may write a home warranty addendum into your contract. In the long run, a home warranty will save you much aggravation and money.

Protecting Loudoun County Townhome Buyers

Buying a townhome for many might be their single-largest investment they may ever make. Why not protect yourself from any potential risk by opting to include a home warranty policy into your offer to purchase and contract. If you have any questions about buying your next Virginia townhome, please contact me now and we will go to work to help you make the right decision about buying your next Loudoun County townhome.

If you would like to have your home warranty questions answered promptly, send an email to WarrantyInquiries@VirginiaIsForTownhomes.com.