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When you purchase a home, agents will usually sell their clients on a Home Warranty. Unfortunately, I often hear horror stories of consumers trying to file a claim with a home warranty company. It can be a roof, an appliance, or a pipe, home warranty companies find every way to NOT cover the costs of repairs. There are more claims that are never covered. Why?

Chase had a water leak in his new home just a few months after purchasing the home. Thinking he had insurance coverage was incorrect and led to additional uncovered costs.

Chase notices his carpet next to his wall in his basement was wet. He wondered what the source of the water. He did a little more investigating to find out the problem.

After pulling back the carpet and the drywall, he discovered a drain line was not set correctly on the drain into the floor.  He contacted his home warranty company who he paid just eight months prior. The company came out and declared that the home warranty company would not cover the costs nor the damage to the home. The company claimed it was set wrong into the drainage pipe, and thus would not fall under its warranty.

Chase is not the first, nor the last. I have had dozens of consumers who have contacted me about the failure of their home warranty company to cover a claim. In the past 20 years, I have witnessed only two claims being covered by homeowners. These companies have denied claims for all kinds of reasons. This can easily add thousands of dollars and additional debt to your budget. 

Do not think that you have coverage when something breaks with a home warranty company when you purchase a house – even when a premium is paid by the seller. It is better to count it as being on your own if something goes sideways.

If I had to pay for one, I would not pay for it. If the seller throws it in for nothing is the only time I would even consider it. Even then, I would not count on the home warranty company. If you have one, make sure you understand full well what is covered and what is not. Be detailed, don’t assume. Know what is covered, and what is not.  

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