Home Warranty Buyers Guide

Reviewer: Charles Weaver | January 23, 2018 

Homeowners – new or aging appliances? Expensive HVAC systems? You can protect against unexpected expenses with a home warranty plan.

Summary:

Let’s discuss what home warranties are, who needs them, and how to buy. We’ll also list some of our customers’ favorite home warranty policies.


Best Overall Warranty

American Home Shield (AHS)

★★★★★

American Home Shield – Full Review > >

American Home Shield has the best all-around reputation and is known for providing the best home warranties at the lowest prices.

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Best Low Cost Coverage

Choice Home Warranty

★★★★★

Choice Home Warranty – Full Review >>

Choice Home Warranty leads the pack with the lowest cost for coverage.

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Best Customer Service

Select Home Warranty

★★★★

Select Home Warranty – Full Review >>

Select Home Warranty scored highest in customer service and satisfaction from claims.

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Home Warranty Buyers Guide:

Home Warranty Basics

Home warranties can provide peace of mind. These are essentially insurance policies that protect you from major home expenses. They are particularly useful to first-time homebuyers who are unfamiliar with home maintenance, and new homeowners who don’t know the true condition of the appliances or home systems they’re buying. Often a seller will purchase a home warranty for a homebuyer to sweeten the attractiveness of a sale, or the buying real estate agent will purchase a home warranty for their client as a gift. These policies provide an important extra level of protection that homeowners insurance often misses. 

Benefits of a Home Warranty

Whether or not you’d benefit from a home warranty depends largely upon your situation. Some of the benefits are peace of mind for knowing that you’re covered in the event of a major appliance breakdown, or system failure like internal plumbing problems that can lead to catastrophic expenses. Home warranties fill an important gap between homeowners insurance and appliance warranties, where homeowners are especially exposed to risk.

✓ Eliminates costly repairs from eating up your paychecks.
✓ Covers major appliances that make a home comfortable.
✓ Increases the ability for you to sell your home.
✓ Covers a variety of different contractor visits.
✓ Provides trusted contractors to fix your appliances.
✓ Adds peace of mind knowing costs are controlled.

Those most likely to appreciate the peace-of-mind benefits are new and first time homeowners. Buying a home, and the first few years in a new home, can be exciting but also stressful. Many people are spread thin financially when they purchase a new home, and the thought of a major expense popping up is scary.

Cost of a Home Warranty

Home warranties are not expensive. They range from $300 to $500 per year depending on the coverage and benefits. It’s generally a rather cheap way of guarding against major catastrophe. If you’re planning on selling your home, or are a new homeowner, a home warranty is highly recommended. 

Do I Need a Home Warranty?

If you purchased or live in a new home, are handy and comfortable repairing your own home and appliances, or are very familiar with the state of your home systems, chances are you won’t need one. But if you just purchased an older home, are spread thin financially, and can’t absorb the cost of a major plumbing, HVAC, or appliance breakdown, a home warranty could make sense.

You may need a home warranty if any of the following apply:

✓ Old appliances
✓ Inability to repair appliances on your own
✓ Your home is more than five years old
✓ No trusted handyman
✓ Not enough money for costly repairs
✓ First time homeowner

Homeowners Insurance Vs. Home Warranty

What’s the difference between homeowners insurance and a home warranty? Homeowners insurance handles all the accidental damages that can happen to your property, like wind damage, fire, or flooding.

A warranty company offers home warranties to cover unexpected breakdowns of your home’s systems and appliances due to normal wear and tear. Unlike homeowners insurance, which is usually mandatory, home warranties are more like a service contract for appliances or systems that will end up aging or breaking down eventually.

For example, if your toddler uses your dishwasher door as a trampoline and breaks it, a typical home warranty will not cover it. But if your dishwasher door won’t close correctly because the seal has come loose over time, your home warranty may cover it.

The Bottom Line:

If you own an older home or are stretched thin financially, you need a home warranty. Don’t wait until your first expensive appliance breaks down and it’s too late. Shop our top picks for home warranty and get instant peace of mind.

American Home Shield (AHS)

4.9 Overall Score

★★★★★

American Home Shield – Full Review > >

American Home Shield has the best all-around reputation and is known for providing quality home warranties at low prices.

View Packages

Choice Home Warranty

4.8 Overall Score

★★★★★

Choice Home Warranty Review >>

Choice Home Warranty provides the lowest cost home warranties available.

View Packages

Select Home Warranty

4.4 Overall Score

★★★★

Select Home Warranty Review >>

Users consistently gave Select Home Warranty the highest marks in customer service and customer satisfaction from claims.

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