If I Get a Home Warranty, Do I Need to Get An Inspection?

Meghan Riley Home Buyer Tips Leave a Comment

Your offer has been accepted and you’re now in the Due Diligence Period. This is when all of the digging begins – inspections, surveys, appraisals, title searches, HOA research, etc. This includes the home inspection, which is a close look at all the major systems of the house to make sure there’s nothing wrong with them. The results can be as small as a leaky faucet or as large as a foundation crack. The cost of a home inspection depends on the size of the home, but averages at $400.

“But, wait! The home I have a contract on is being sold with a warranty. Won’t that cover everything?”

As much as we would love for you to save some money, the answer is no. Here’s why the home warranty does not replace a home inspection:

  1. If you’re financing the home purchase, there’s a chance that the lender requires a home inspection. You or your Realtor should verify the loan requirements with the lender to make sure that you aren’t doing anything that will disqualify you from being approved, like not getting a home inspection.
  2. A home warranty usually has a dollar limit. If the HVAC in the home dies and the replacement costs $5,000, the warranty may only cover about $1,500 of it. As the home owner, you’ll be responsible for the rest.
  3. An upfront service fee still exists. Depending on the package chosen by you or the seller, your service fee could be $75 or $100. This is often a fraction of what you’ll pay for a regular service call, but the fact is are still paying out money to fix an issue that could have been caught by the home inspection and resolved prior to closing.
  4. Not everything is covered by a home warranty. Most home sellers offer the basic plan, sometimes the extended HVAC coverage. Don’t misunderstand, the basic coverage is great for handling many common issues that arise in the first year of homeownership and can greatly reduce your upfront costs. However, warranty packages often require add-ons for more unique home features, like a swimming pool or water softener. If you’re concerned about the warranty’s coverage, you can always request a brochure prior to closing.

A home warranty is definitely a nice perk as 7 out 10 homes have an appliance or system break within the first year of ownership. However, it does not replace the home inspection. An inspection will catch needed repairs that aren’t covered by a home warranty, allowing you to have them resolved by the seller before the home is closed on. Otherwise, you’ll be paying for repairs out-of-pocket when you discover them after the purchase is finalized.

Want to see an example home warranty brochure? We have one from 2-10 Home Warranty that you can view right on our website. It will show you the services offered, cost limits, service fees, and exceptions.

Have a question about buying a home in the Wilmington area? Give us a call or send us a message through our Contact page.

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About the Author
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Meghan Riley

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Meghan is the Client Care Coordinator for The Cameron Team and a published author of two young adult books.