Home warranties might make sense for homeowners that want an easy way to take care of problems including not having to have a list of contractors at the ready or maintenance techs to do the easy stuff or maintenance coordinators to put all the pieces together. You however are hiring a property manager and that is exactly what good property managers do for you. Home warranty companies are in business to make a profit, do not give away part of your residential property investment profit to make a home warranty company wealthier.
Home warranty companies are notoriously difficult to work with, often refuse claims and rarely get things taken care of within the legal timelines. Sometimes warranty companies can not repair or replace in a timely manner and we may need to use an alternate vendor. Frequently warranty repair people can only provide a time frame (for example noon to 4pm) for an arrival time. In this case if the tenant can not be home we will still need to send a maintenance tech to the property to wait for them and you will be billed for our handyman's time. Using our pre-screened contractors you wont have double charges like that.
But do not just take our word for it do your own searches or check out these articles
https://www.investopedia.com/articles/mortgages-real-estate/11/home-warranty-worth-it.asp This one is from investopedia.
https://www.biggerpockets.com/forums/52/topics/715632-property-manager-home-warranty Steve Rozenberg's comments are extremely accurate.
Read the 4th comment on this page (as well as the rest of it) as this biggerpockets.com employee hit the nail on the head https://www.biggerpockets.com/forums/52/topics/477675-home-warranty-plans-yay-or-nay
We no longer work with home warranty companies for new properties and will phase out working with home warranty companies by the end of 2021 (now 2022 to give more time to cancel current contracts). Take the money you are paying or considering paying a home warranty company and put it in an emergency fund acct. In most every case you will come out ahead in the end...that's the bet the warranty companies are making too.
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