Let’s talk about Home Warranty!

[Andrew Brown]

Hey Everyone, I’ve read a few posts where people have mentioned various things they had to fix for their rentals, including appliances and I wanted to offer my two cents. If you are a landlord, I would HIGHLY recommend getting a home warranty policy. Here are a few examples when having it saved me THOUSANDS of dollars for both my personal residence and rental property (price and benefits are the same)

1. Plumbing Leak (Rental): Called because my tenant noticed brown spots on the downstairs bathroom ceiling (upstairs bathroom floor). Called home warranty and they sent a company out in a few days and diagnosed a small leak and fixed. A second company (paid by the warranty) to patch the hole. A week later, I had a massive second leak from the tub and again, the warranty had the original company come out and fix the issue. Yes, I had a problem the second time but it was due to the entire ceiling being damaged. However, the plumbing company rectified the situation and had the entire ceiling patched and textured. My out of pocket cost: $0 (excluding the $34/month I pay). My regional rep waived the $75 trade fee!

2. HVAC (Personal Property): I took a cash out option that gave me $1,001 -after trade call fee, to repair the heater unit. I had been complaining for months that the system didn’t seem right. This home warranty is not the same as the company used above and will never use them again. Main reason without getting to deep is the fact the system is old and I did not have a “first class upgrade”, which is critical for older HVAC systems in CA because the law is any new system must meet a minimum SEER rating. Nonetheless, I was still able to get a $1,000.

3. Stainless Steel Fridge (Personal): Recently my fridge went out, and after a few diagnostic attempts, it was finally fully fixed on Friday. Had I paid out of pocket for it, the cost would have been north of $600! My cost, technically $0! $75 was my trade call fee and then the home warranty mailed a $75 check to cover the cost of a small fridge /freezer.

Bottom line, I’ve spoken to my area rep regarding this subject numerous times and she told me that she does have Investor clients and that a home warranty company can act as a de facto property manager. Again, a warranty coverage can save you thousands, but also remove a lot of the headache that comes with fixing stuff that breaks. Now there are certain items that aren’t covered, but a majority of issues are, and it’s in your best interest to utilize this resource. My mom and aunt paid $15k for electrical work and had a home warranty been established, the cost would have been greatly reduced, if not eliminated.

Anyone else have thoughts regarding this?