Home Warranty

I love home warranties!
I know some financial gurus warn against “wasting money” on
various warranties, and mostly, I agree, but not when it comes
to home warranties. About the only time I wouldn’t buy one is
if I was buying a new or almost new home with all new
A little about me…. I have bought quite a few older homes now.
Doing so is unpredictable, as it is just a matter of time before
the hot water heater goes, the furnace won’t come on or the
refrigerator dies. Now, I know that I can call a bunch of service
people and get the low-down on their trip charges, possible
rates etc. but that won’t answer the final question of how much
will it cost me or how good, or ethical their service will be?

Horror Story #1
Once I had a furnace guy come out and to his surprise, I went
into the crawlspace with him. For this, I was paying a $60 trip
charge. Once down there, without even opening it, he declared I needed a new furnace. I told him I thought he was going to
assess the problem and fix it. He then said there was a fee to
open the cover and find the issue (really, what was I paying for
then?). He did that and then said it needed to be replaced
without doing anything. I decided not to use him and hired a
more respectable repairman. He found the issue, and for a
small amount, replaced the part and it worked fine. 10+ years
later it is still working fine. You might think this was just one
bad instance but unfortunately, many of my furnace repair
stories have resulted in people just telling me to replace them
and it seems there is a high turn-over rate in the industry so it is
hard to keep the good ones.
Lessons Learned:

The warranty companies are motivated to fix the problem
and approved to replace the item if they can’t. They aren’t
there to sell you something you don’t need. They are not
motivated to jerk you around, it is a service call fee to you and that is all, they are paid by the warranty company for anything beyond the fee.

Horror Story #2
A refrigerator at one of my properties went out so I called 3 service companies, got estimates on trip charges and possible costs and I chose the one that sounded the best. After a lot of wasted time and calls back and forth between the tenant and I, and the service guy and I, we finally agreed on a time for him to go out. He did fix the fridge, but in doing so, he made racists comments about my sweet tenant It didn’t occur to me to screen for racists, and it did put me at risk of being sued for racism, as all landlords are responsible for those working for them. Now I can’t say that all service people from a home warranty company are not going to do this, but they have a longer history of working with their contractors and would have probably already dealt with these complaints and done something about it. The service people see these jobs as a long-term job for the warranty company and not just as a one-time job for someone they will never meet again, so they are more likely to act like professionals.
Lessons Learned:

  • One phone number for all problems is the bomb!
  • The service people contact the tenants to arrange a time to meet, you don’t need to be involved, or if it is your home, they call you and set the time.
  • The service people usually have a long-term relationship with the warranty company and are usually, super professional.
  • If they are not professional, you know the one number to call.

As I said, the greatest benefit is having 1 number to call which means you avoid having to interview people about the pricing, time frames and experience in a pinch. For a working, single mom, this is worth it’s weight in gold. The second most important benefit is that, for the price of a trip charge, you know that your appliance or major system will be fixed or replace within a reasonable span of time.

Not all Home Warranty Companies are the same so check the
small print to make sure they replace like item with like item. If
you installed a 3k refrigerator you don’t want it replaced with
an $800 one.
There are always basic plans and add-ons. When purchasing,
make sure you go over all the items in your house, especially
unusual ones like pool pumps, etc. These can be very
expensive, and you want to make sure you are covering what
you intend to cover.

Home warranties provide peace of mind as you are not as likely to be hit with some big, surprise bill. Since you pay monthly, or you can opt to pay yearly, most of your big-ticket items will be paid for by the warranty so you do not need to worry about large bills or maintaining as large of a repair fund.

My personal favorite is First American Home Warranty (970-404-5099) as they replace like with like items, usually are very responsive and are a good value. I have recently used American Home Shield (855-210-9541) and though the people who first answer the calls were not very knowledgeable, the people higher up on the ladder were and my issues were ultimately resolved. *

I’m always happy to talk with you about my experiences or help you with anything real estate related. Please feel free to contact me.

Laurell Richey- REMAX Alliance

*I do not receive any benefits from these referrals, these are truly my feelings about the providers.


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