Home warranty renewal

[thomasdan]

Hey everyone,

My wife and I had just completed our 1st year as a homeowner. During escrow, we had our 1st year of home warranty paid for. THe renewal is about $550. We are new to all this. But do home owners usually renew the policy? or do they just depend of EF to cover cost?

[Drake3287]

I have to admit I stuck with it and I've spent more money on my American Home Shield policy over the years than what I've gotten out of it. I keep waiting for my furnace to break before canceling the policy. The only problem is it won't break! I keep telling myself that after a large repair I'm going to cancel the policy.

There are many down fall's of having this policy, the company I use contracts with the companies that I would never have called in the first place. Many times they are a one man show with a pickup truck that happen to have a license. I have only once ever had a "name brand" repair service.

Our insurance company doesn't provide any quick service. They don't care if it's the day before Thanksgiving and your ovens broken or that the main water line to your house is broken. When the contractor finally does show up they have to call and get any work authorized. These contractors typically don't have the parts they need so they order the part and come back a week later. Like I said, they don't care if your being inconvenienced, it's all about the money.

Don't ever expect same day emergency service like you would get if you were paying out of pocket.

[MKKShah]

I am not sure I would extend it. It is likely a waste of money. I used to buy all kinds of protection once upon a time. But realized that in these cases (where the net loss is limited) it is better to be self insured and save in the long run. If it's a big ticket item like a furnace, I would want it to be done right and to my liking if and when it breaks.

Plus, financing the repair is always an option if you have good credit, and are short in cash.

[wjcalderon]

It also depends on the house.
I bought a 15 year old house that had been vacant for 10 years.
A year after I moved in the A/C went out (right after I got laid off from my job).
That warranty really saved me.

I cancelled the warranty shortly after that.

[Spiffster]

Ehh, warranties, by design, are never a good deal for the average homeowner. Would be better off putting that money towards your EF.

[snafu]

Warranties are one of those products where you truly need to read and understand the small details. We don't buy appliance/electronic extended warranties because we do a significant amount of research as part of the buying process. General research says if the item is faulty you'll most likely to have problems within the product's own warranty time frame. Part of the reason we bought a particular car was the terrific warranty that the dealership transferred [don't let them charge for a few computer clicks].

What items does the warranty cover? Do you get to choose the supplier? What did the house inspection identify as potential problems when you initially purchased? What is the rating for your particular furnace, AC, roofing material, chimmney etc?

[Retired To Win]

I have had excellent luck with the home warranty company (HMS Home Warranty) I have used since the year 2000.

Initially, the warranty came with the house we had just purchased. Within 2 months of buying the house, the furnace did require an expensive fix and the warranty covered it. I was pretty sold. By the time renewal time came, I had had a couple of more occasions to call on the warranty and was pleased with the outcomes. So we renewed.

That was 3 houses and 15 years ago. We keep renewing the warranty (around $550 a year). We continue to be happy with it. It continues to -- at the very least -- pay for itself each year while saving me the hassle of finding and vetting repairmen. (The warranty company guarantees the repairs, FYI.)

However, I have had people on other forums literally scream at me over the internet regarding this issue. They all claim to have had horrible experiences and/or that these warranties are a complete waste of one's money. And they think I am an idiot for having one.

What can I say?

[marvholly]

I would suggest evaluating the age & condition of MAJOR things like the roof, furnace, & a/c. Smaller items (water heater, possibly washer/dryr, that would be about $500 to replace I would not worry about. Fridge or stove at about $1000 is a borderline item.

Also, remember to take into account the co-pay and/or deductable.