Many Minnesota homeowners, especially first-time buyers, wonder if you have to have a home warranty for your home.
The answer is no, you don’t have to have one. In fact, you may find that a home warranty is not the best fit for your budget and plan of how best to protect your appliances and home systems.
If you’re considering signing up for a home warranty, you should know there are alternatives available to you, such as home repair plans.
Below you’ll find details on why you may want to forego a traditional home warranty for a customized home repair plan that fits your lifestyle and wallet much better.
What is a home warranty?
A home warranty is a contract–typically for one year–between you and a home warranty company that will cover some or all of the cost of repairs and replacements for certain home systems and appliances when they break down.
Commonly covered items include electrical, plumbing and heating and air conditioning systems, and sometimes things such as pest control, pools and spas, garage doors and more. Doors, windows, floors and other structural features are typically not covered.
The way home warranties work is when a covered item stops working, you file a claim with your warranty provider, which then assigns a third-party contractor to make a service call.
The contractor then investigates the issue and informs you whether, in its professional opinion, the home warranty company will cover any or all of the repair. It will then file a report with the home warranty company, which will issue its decision about how much, if any, of the cost of the repair it will cover.
It will then be up to you to decide how to proceed, whether to pay the balance of whatever the home warranty provider won’t cover, or engage your own repair company.
Do people like home warranties?
Polling results show the majority of homeowners with home warranties are satisfied with them and that most of their claims are ultimately approved. Often warranty holders obtain their warranties at no additional cost by having the seller of the house they bought cover the warranty cost as part of the real estate transaction, so they’re not out any additional money.
There is a lot of variation among providers and contracts, so it is possible to get a warranty you’re happy with, just as it’s possible to get one that may not work for your needs.
Home warranty alternatives
Check appliances for existing warranties
Home warranties cover (some) appliances, but those appliances may have their own warranties on them already that could secure for you free labor, parts or even replacement in some cases, depending on how old they are.
Typically the offers of free repair work diminish the older an appliance is, but even just free parts could make paying for a home warranty unattractive enough to skip it. Extended warranties are something to consider, as well.
Here are example timelines for
GE’s appliance warranties in instances of materials or workmanship defects:
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Up to 1 year
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Free parts and labor
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Free parts and labor
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Free parts and labor
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Free parts and labor
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Up to 2 years
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Free parts
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Free parts
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-
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-
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Up to 5 years
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Free racks, electronic control board
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Free suspension strut assembly, motor, motor controller, door, door panel
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Free sealed refrigeration system with parts and labor
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Free any part of the sealed refrigerating system
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Lifetime
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Free tub or door liner
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Free inner wash basket
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Yes
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Free full extension slides
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Home repair plans
Though the two terms are sometimes used interchangeably, a home repair plan is different from a home warranty.
A home repair plan provides coverage for one or several home systems and appliances that can include maintenance, repair and/or replacement when something breaks down.
It’s customizable, allowing you to pick and choose the coverages you want without having to worry about exclusions. Out-of-pocket expenses for trip charges and modifications are also off the table.
Home repair plans are also a way to cover home systems such as exterior gas lines that typical home warranties don’t cover.
Regular maintenance
Every appliance manual has a “care and maintenance” section, but how many of us follow those manufacturer recommendations perfectly? Most of us get busy and forget, but those guidelines are there for a reason: they can improve performance, extend the life of the equipment and prevent breakdowns.
A one-time maintenance call or, better yet, a maintenance plan, are alternatives to home warranties and ways to protect against costly repairs.
Heating systems in particular need regular checkups to ensure they’re ready to weather cold Minnesota winters. The cost to maintain them will almost certainly be lower than emergency repairs, and those savings can be stored up for replacement purchases when an appliance inevitably reaches the end of its life.
Save for repairs
Although it may be fairly obvious, it’s worth pointing out that you always have the alternative of simply saving up for appliance and home system repairs. After all, if you don’t use your home warranty, the money you spent on it could have been put toward a rainy day fund, especially if you take good care of your appliances through regular maintenance.
This option will likely depend on how old your appliances are and if, based on average lifespans for similar appliances, they’re due to wear out relatively soon.
Payment help
Especially with big-ticket items such as air conditioners, repair companies commonly offer financing terms or other flexible payment options for paying for appliance repairs out of pocket. A credit card purchase may be an option for you, as well, especially if you can get one specifically designed for appliance or home improvement purchases.
Similarly, a home repair loan may be advisable, depending on the interest rate you can get. This is such a common expenditure for homeowners that there are even appliance-specific personal loans, such as
HVAC loans.
Great coverage without the hassle
We may be biased, but at Home Service Plus®, we believe your best home warranty alternative is one of our Home Repair Plans.
Whether you want peace of mind for a small number of appliances or a full suite of home systems, you’ll receive high-quality support from trained technicians, with no out-of-pocket expenses. It’s easy to sign up and easy to schedule service.
If you thought home warranties were the only game in town, Minnesota, think again!
