Many homebuyers leave the closing a little shell-shocked and much lighter in the pocketbook. The last thing they need is a major appliance like the oven or the furnace going out just a few weeks after move in. The fix? A home warranty.

Or is it?

Many people swear by home warranties, and still others think they are a waste of money. What are the odds that you’ll have to replace the air conditioner within the first year of moving in, especially if the system is relatively new? While the odds are low, it also depends on many variables that may be outside the new homeowner’s control.

As with any major purchase, there are pros and cons to both sides. Let’s explore.


A home warranty will pay to fix or replace covered kitchen appliances, furnace, water heaters, ceiling fans, sump pumps, and other covered mechanicals. The cost is fairly reasonable (around $350-$500/year). If you want additional coverage, for another $100-$200 you can cover your washer/dryer,refrigerator, air conditioner, etc. What you are really buying is peace of mind. For a fairly small outlay of cash, you can protect yourself from potentially larger outlays of cash to repair or replace those mechanicals out of pocket. To cash-strapped new homeowners, this may seem like a dream come true.


You have to read the fine print and fully understand what is covered in the policy. Your claim will be denied if you submit a claim for a mechanical repair or replacement that is not specifically stated as covered in the policy. In addition, each system must be properly maintained – you will not be covered if negligence was the cause of the malfunction. If the warranty terms are not met, then the warranty company will deny the claim. You may have some idea from the inspection how well the mechanicals were maintained by the previous owner, but you won’t really know for sure until something breaks.

Also, the warranty will likely not pay the entire cost. You will likely be responsible for the service fee charged by the repair person, and the warranty will pay for the cost of the repairs only. There is also the consideration that nothing at all will break, and you spent the money for nothing.

The Bottom Line

The decision to get a home warranty largely depends on you and your peace of mind. If you are very risk-averse, and would prefer to have some comfort in knowing you are at least partially covered should something break, then by all means, get the warranty. If you feel financially comfortable enough to handle unexpected outlays of cash, then you may consider the expense not worth it. In either case, know exactly what you are getting into and read the warranty fully, to avoid unfortunate surprises later.

When it comes to buying or selling your home, we are here to help answer any questions and guide you through a better understanding. Please do not hesitate to contact us at or phone us at 202.800.0800.



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