New homes are exciting and scary all at the same time. You've picked a home builder, or purchased a newly built home. Once you're in, if something goes wrong, where do you turn for help?
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Let's look at what is covered by the builder and how you file a claim.
Builder Coverage
New home warranties usually offer coverage for workmanship and materials for home components like the exterior siding or brick, windows and doors, drywall, paint, heating, ventilation and air conditioning (HVAC), plumbing, and electrical systems for some period of time.
Home structural elements are typically covered for a year, while home products like plumbing and electrical, for instance, can be covered for longer. Major structural elements like the foundation or roof can be covered for even longer, in some cases for 10 years, protecting you from sinking foundations or collapsed roofs.
Builders don't cover appliances or other home products like garage door openers, security systems, or automatic shades. The manufacturers would warranty consumer products.
What's Not Covered by the Builder?
New home builder warranties don't cover 'small things' like nail pops or cracks in the cement or brick, nor do they cover the cost incurred by the homeowner if a major covered issue is repaired, such as the cost of a hotel while a foundation is being repaired.
What To Do If a Problem Occurs.
If an issue occurs, make sure it's covered by the builder. You can review the warranty terms the builder provided at closing. If it's a covered problem, most builders also define the process for requesting a repair in the same documentation. Much the same, most also define an escalation or arbitration process if there is a dispute. The arbitrator would determine the outcome of the claim. If there's no mandated arbitration then going to court is an option as well, albeit a potentially expensive one.
How Can Homeowners Protect What the Builder Doesn't?
Home warranties are a great option for protecting what the builder doesn't. Appliances and home systems like plumbing, electrical, ceiling fans, garage door openers, ductwork, and even utility lines and your pool and spa can be covered by a new home whole home warranty. A home warranty provides coverage for mechanical failures of covered systems, saving the homeowner from the expense of the repair. The home warranty company pays the repairman instead of the homeowner.
Do the Math
Left unprotected, appliances and home systems can cost a lot to repair outside of the manufacturer's warranty. Consider the following average costs of repair:
- Appliances: $175 average, up to $500 in some locations, for some appliances.
- HVAC: from $150 on the low end to upwards of $500 on the high end.
- Plumbing: $125 to as much as $800 for big jobs!
- Electrical: from repairing a light fixture to replacing an electrical panel can run from $150 to $2500!
You can find examples online for every major home system in your new home. Protect your home and your bank account by adding a whole-home warranty to your portfolio of protection and insurance products. Home warranty companies pay the cost of covered repairs, performed by vetted, trained, and contracted technicians, saving you the hassle of finding a repair company on your own and writing the big check.
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