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Location: Mars Hill, NC, United States

A small, highly personalized real estate firm specializing in mountain homes and land in greater Asheville.

Friday, June 26, 2009

Home Warranties: Newly Popular

Some observers have noted that the home warranty industry is experiencing a boom, no doubt. In 2008, 42% of existing homes conveyed with a warranty in place.

A home warranty is different than its more familiar cousin, the builder's warranty which is associated with new home sales. The home warranty is an instrument applied to the sale of existing homes.

Home warranties are designed to cover the systems and components of resale homes against unexpected failures. Depending on the individual warranty, new owners might be protected from financial loss on anything from appliances to central air conditioning, plumbing, and more.

Rising Popularity
Private sellers have struggled during the decline with how to add value and induce buyers without spending a lot of money. At a cost of roughly $400 to $650/year, the theory is that sellers can recoup more than its cost in the sale price.

But there are a number of cautions, largely directed at home buyers, and honestly the bottom line is read your warranty.

Things to Know
The NC Attorney General's Office: Provides six useful tips. The biggest thing a person can do is read and think. The bullet points include such things as; possibly waiving your right to court proceedings if unsatisfied with a repair, the exclusion of certain failures or systems in the house, replacing failed equipment with brand names of their choice, and so forth.

The NC AG recommends having your attorney look a home warranty over and never should a home warranty be a substitute for a home inspection as part of the purchase process.

Liz Pulliam Weston from MSN Money Central extends the buyer beware theme with such questions as; What is a pre existing defect? Where exactly does my plumbing "end"?

Here is a good quick reference check list from Elizabeth Weintraub at about.com including, items typically covered, not covered, and some general means by which payment can be denied.

The web is filled with anecdotes of home warranty snafus for buyers. The summary lesson would seem to be, go slow, think, read, and seek good advice.

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Black Bear Realty Website
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Filed Under: Tips for Buyers, Tips for Sellers

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