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I know — we’re all Toolmongers here and should fix everything ourselves.  But sometimes you either a) don’t have time, or b) need some expert experience — like when your air conditioner breaks.

It’s for exactly those times that some friends have been recommending that I pick up a home warranty — one of these $300 to $600 a year “policies” that covers HVAC, appliances, garage doors, and such for a $50 service call “deductible.”

Do any of you have experiences with ’em, and if you’ve had positive experiences could you share who you went with?

(And yeah, the picture above is meant to be funny.  My house doesn’t look that bad.)

Update: Roscoe adds in comments that significant benefits can be had simply by adding (relatively) inexpensive riders to your homeowner’s policy.  He writes: “Make sure you get coverage for water in your basement as a result of power failure and sump pumps not working” and “make sure you’re covered for lightning strikes, get coverage for your tools that you keep in your house, and get coverage for earthquakes even if they’re rare in your area.  Most agents are reluctant to offer these riders, but very few won’t do it if you’re persistent about what you want covered.  You’d be surprised how cheap it is to insure your tools.  I’ve seen it for as little as $10/year.”


11 Responses to Hot or Not? House Warranties

  1. Mike says:

    When we bought our house, it came with one, and at first I thought it might be a good deal for an older home. But they didn’t cover the dishwasher that was making an ugly noise, the faucet with an occasional drip, or other non-catastrophic failures. Also, they got to pick the repair people, and there was a sixty-dollar charge for each service call.

    After I paid $60 for one guy to tighten a nut and replace a washer, and had to break out the mop after another guy forgot to turn off the water, well, I decided to live on the edge. If you’re moderately handy and no major systems shoot craps, you’ll be money ahead?

    What are the odds that your furnace is going to die in a way that they’ll cover? I don’t know, but I can guarantee you that the home-warranty people have done the math, and that the odds are on their side.

  2. Even if something major like your furnace or ac died, they would probably replace it with the cheapest piece of junk available, so I view these as next to useless.

    They probably make most of their money on people selling houses, since it gives the buyer at least a little bit of security for the first year.

  3. Will says:

    I can second Pat Fitz’s comment. Our compressor motor burned up (in Texas, in July). The home warranty people sent out a repair person. They showed up in a very dirty, very broken down personal car. They didn’t appear to be with one of the bigger local HVAC shops.
    They figured out what type of fan they needed and disappeared for a few hours. They eventually returned with an obviously used motor. The warranty didn’t specify that new parts must be used. I decided not to renew the warranty and of course, the motor burned up the next summer.

  4. Rob says:

    Between the deductible and the annual fee, you could probably pay to have whatever appliance etc that broke down, fixed. Then there’s also the odds that you would have more than one covered item break down in any given year (low). Add to that, the fine print (they don’t cover everything usually), and you’re really not looking at a great deal. Like Patrick said, more of a peace of mind thing for a new homeowner.

  5. Roscoe says:

    If you’re looking to buy a house, don’t let your realtor talk you into one at closing, you want the cash!

    Home warranties are, in my opinion, just the real estate market’s spin on up-selling- not any different than the extended warranty you don’t want on your appliances at Best Buy.

  6. Me says:

    Whenever I buy a house (and I seem to do that a lot for some reason), I always request the seller buy one for me. It gives a little security that if something major goes wrong, you might be covered.

  7. Erik Hovland says:

    I agree with the other posters. If a seller is throwing it in with a house, get it and make sure that every single appliance that is coming with the house is on it (dishwashers, washing machines and refrigerators are typically not covered by default). Otherwise, don’t get it.

    I will mention that I have had a home warranty with two different homes (both thrown in by the seller). When I had to have things fixed the response time was quite long (2-4 days depending on the service) and the turn around time for the fix could be very long (2 weeks). Since I didn’t pay for the warranty initially, the $60 a visit cost was no big deal and more then paid for itself. But I only ever used the warranty a few times. I also was more likely to call since I had the warranty.

  8. Dan Sroka says:

    We have had bad experiences with home warranties. We had a couple issues pop up after we bought our house that should’ve been covered, but each time there was some subclause, or sub-subclause that invalidated out claim. For example: our boiler blew out, during the middle of the summer. Something happened, and the thing came on by itself and self-destructed. A plumber friend had to rip the thing apart to get it to stop spewing water and fire. The warranty folks therefore claimed that they wouldn’t cover any of it, because it was “worked on” by an unauthorized person. Never again.

  9. Jason says:

    I’ve had pretty good luck with these things. I bought a 50 year-old house a couple of years ago as a project house and the seller included one. A few weeks later my water heater died and I had a new one installed two days later, 100% covered by the warranty. Unfortunately the idiot who installed it first brought a short-fat water heater even though it was obvious it wouldn’t fit so he disappeared and came back with another 3 hours later. He installed that fine but it seems like he turned it on before filling it, burning out one of the elements in the process. Another call to the warranty people got me a better installer with a new element.

    Sure, I could have done it myself but it cost me nothing but two phone calls.

    Basically, if you expect a major, covered, system to die (i.e. it’s an older house) I would get one. If not, don’t bother.

  10. I got one with the house I bought nearly four years ago. At this point I will fix anything myself on the house except the roof (I have a tendency to fall off) or anything connected to a natural gas line.

    We had our gas water heater corrode out the first year we had the house under the warranty. Some dude came and replaced it. He didn’t do the best installation job ever but it works and it’s the same thing we had before except new. That pretty much covered the cost of the warranty, so it worked out. I wouldn’t keep renewing unless you’re worried something is going to die and you can’t fix it…but at least if you know a good contractor you will probably get better work than the warranty work. It would make me quite angry to pay somebody to do a job that I can do myself and then they do it worse than I would have. If I’m paying, I want it done better, faster, seeing as how they do it every day.

    Our furnace and air conditioner were very old (something on the order of 40 years old) but working okay. I ended up having to replace the behemoth of the furnace in the basement so I could make the stairs go the direction of the stairs above them, instead of against (which made stairs that were like a ship stepladder). I was always worried the compressor would go out in the summer and the heat exchanger would go out in the winter, but now it’s all new, and I’m about 6 grand lighter because of it.

    Oh yeah, my house was built in 1876 so everything I do here is an adventure.

  11. Roscoe says:

    I can’t reiterate enough that these things aren’t free. If a seller offers to throw one in at closing, you’re paying too much. Tell them you think it’s worth ‘x’, $500-1000 IMO, and ask them to reduce closing costs by that amount. You’re better off hiring your own contractor if needed. You could also hedge your bet by buying more types of coverage as riders to your homeowner’s policy. Make sure you get coverage for water in your basement as a result of power failure and sump pumps not working (this isn’t covered under flood insurance), make sure you’re covered for lightning strikes, get coverage for your tools that you keep in your house, get coverage against earthquakes even if they’re rare in your area. Most agents are reluctant to offer these riders, but very few won’t do it if you’re persistent about what you want covered. You’d be surprised how cheap it is to ensure your tools, I’ve seen as little as $10/year.

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