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Old 02-03-2017, 07:22 AM
 
11,230 posts, read 9,200,928 times
Reputation: 32248

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I always ask people the same question:

Q: How do you think the "home warranty" companies make money?

A: They make money because people pay in more than the company pays out.

Of course there will be many examples of people who got more than they paid in, but the average customer will pay in more than they ever get out. Given that the kinds of repairs covered by these companies are not the kind of expenses that would spell financial ruin and homelessness, but rather are an inconvenience, I see no value in these products.

By contrast, the medical expenses contingent on, say, a heart attack with triple bypass surgery and extended rehabilitation, really could wipe out a family's entire life savings, retirement funds, and plunge them into debt everlasting. This is why it's a really good idea to have medical insurance.

Replacing a garage door opener or AC unit? Not really the same kind of magnitude.

I recommend giving it a miss, and instead talking to your neighbors, co-workers, family members, etc., to get recommendations on tradesmen before you need them, building up a file of recommended people, so when something fails, you have people to call.
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Old 02-03-2017, 07:24 AM
 
11,230 posts, read 9,200,928 times
Reputation: 32248
Quote:
Originally Posted by ChristieP View Post
We had an AHS warranty that the sellers bought for us...
Actually, you paid for it. The only people who brought money to the closing were you, the buyers. Could you have told the sellers to bag the warranty and reduce the sale price by the same amount? Maybe, maybe not; but you paid for it neverthless.
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Old 02-03-2017, 07:36 AM
 
Location: plano
7,885 posts, read 11,340,656 times
Reputation: 7789
Quote:
Originally Posted by greenusa17 View Post
Hope all are doing great! Thank you very much in advance.

I got the home warranty from American Home Shield and paid $500 for 1 year plan.

I called them for 1 appliance issue. I was on hold for 2 hours, finally got someone online, they scheduled service after 2 days and told me I have to pay $75 just for them to enter my house.

I was frustrated about wasting all time. I called local person, he came in 1 hours, paid him $50 to fix the appliance issue.

So Now I am confused, Is home warranty worth it?

I pay $500 per year and $75 per visit. is it better to not have it?

Can you guys please share your knowledge on this?

We will sincerely appreciate all info.
Thank you very much
All the home warranty providers are for profit businesses. They charge more than they expect the avg home covered costs them. Delay and repair are common even when replacement might make more sense if you get a more efficient HVAC unit for example. You can avoid high cost replacement projects every so often but on average they are making money at the policy cost or they would not offer it. Some will win having one but for every winner there are a number of losers to make the big cost replacement work at one house. I don't have one and dont want one but have sufficient assets to incur these large costs on my own when they pop up..
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Old 02-03-2017, 07:56 AM
 
3,678 posts, read 4,134,584 times
Reputation: 3332
Quote:
Originally Posted by turf3 View Post
Actually, you paid for it. The only people who brought money to the closing were you, the buyers. Could you have told the sellers to bag the warranty and reduce the sale price by the same amount? Maybe, maybe not; but you paid for it neverthless.
Haha. That's so true. Another thing that makes me chuckle is the notion that buyer's agent costs nothing to buyers. Not saying they aren't ever worth it but in most cases they aren't.
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Old 02-03-2017, 08:00 AM
 
3,678 posts, read 4,134,584 times
Reputation: 3332
Quote:
Originally Posted by Johnhw2 View Post
All the home warranty providers are for profit businesses. They charge more than they expect the avg home covered costs them. Delay and repair are common even when replacement might make more sense if you get a more efficient HVAC unit for example. You can avoid high cost replacement projects every so often but on average they are making money at the policy cost or they would not offer it. Some will win having one but for every winner there are a number of losers to make the big cost replacement work at one house. I don't have one and dont want one but have sufficient assets to incur these large costs on my own when they pop up..
Same here. I tried three and learned my lesson, I know that you get what you pay for so wasn't expecting too much but there was so much headache for so little that I gave up.
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Old 02-03-2017, 08:05 AM
 
113 posts, read 154,422 times
Reputation: 139
American Home Shield is the worst. I once had a warranty with them and never again. I cancelled my renewal with AHS because they weaseled out of a number of repairs and the few things they did fix took multiple tries and were not worth $500. Also, you have to pay the $75 fee even if they determine the repair is not covered. In my opinion, home warranties are only worthwhile if the seller pays for it, and even then it's a crapshoot. Perhaps there are better warranty companies out there, but I've heard of similar experiences with other companies.
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Old 02-03-2017, 08:27 AM
 
97 posts, read 91,738 times
Reputation: 25
I hired Trusted Home Restoration Company in Dallas, Fort Worth | Stanley Restoration. they just told me that house is dry now with no moisture, no mold. only pending issue now is water marks in 2 locations in ceiling and wall. they dont have time to fix these issues and told me to call other companies for that. can anyone recommend solution for this? Can I trust stanley's statement for no moisture, no mold? or do I need to do further testing?
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Old 02-03-2017, 08:42 AM
 
11,230 posts, read 9,200,928 times
Reputation: 32248
Does it smell musty and moldy? If not, don't worry.

For water stains, prime with Kilz sealer and repaint.
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Old 02-03-2017, 08:49 AM
 
65 posts, read 83,574 times
Reputation: 69
Mine definitely worth it. My pool pump was down and they paid it, the price would be $1000+, also they changed the motherboard of my garage opener besides lots of small issues in my house. I paid $60/time for the service fee but that saves me some hassle finding all the companies doing the repair work.
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Old 02-03-2017, 08:55 AM
 
216 posts, read 278,691 times
Reputation: 167
I have AHS (the sellers paid for it) and I think I've broken even with a fan motor replacement ($600) and a plumbing stoppage but it is definitely not work the $700 renewal fee.
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