Does a Home Warranty Cover Repairs to Justify the Cost? Javascript must be enabled to use this site. Please enable Javascript in your browser and try again. × Search search POPULAR SEARCHES SUGGESTED LINKS Join AARP for just $9 per year when you sign up for a 5-year term. Get instant access to members-only products and hundreds of discounts, a free second membership, and a subscription to AARP the Magazine. Leaving AARP.org Website You are now leaving AARP.org and going to a website that is not operated by AARP. A different privacy policy and terms of service will apply.

5 Things Home Warranties Don t Cover

A warranty can offer peace of mind to a home buyer but it doesn t cover every repair

Dimitri Otis / Getty Images If you've bought a house recently, the seller may have given you a home warranty to sweeten the deal. Or you may have bought a home warranty on your own, hoping to save yourself a big bill if, say, the dishwasher stops washing dishes. A home warranty – or home service contract, as the industry prefers to call it – can save you the hassle of finding a qualified repairman as well as the budget-busting cost of some common home repairs. “We're providing a service for a homeowner on a budget,” says Art Chartrand, executive director of the National Home Service Contract Association. “We're not offering something for free, and we're not magicians, but we can send a prescreened contractor to your home to get you back up and running." Get instant access to members-only products and hundreds of discounts, a free second membership, and a subscription to AARP the Magazine. Still, home , which protects you against damage from certain perils, such as fire and theft. Instead, they are service contracts, which means they cover only what's in the contract. Anything else is up to you. The first rule of any contract: before you sign it. Generally speaking, a home warranty contract will cover most appliances that fail because of normal wear and tear. Typically, these will include kitchen appliances, water heaters, washers and dryers. If you own a home with older appliances, a home warranty can save you money in costly repairs. But there are a lot of things that a home warranty often won't cover. Among those:

1 Anything that fails within the first 30 days after signing

Although a home warranty isn't insurance, it does borrow a few things from the insurance industry, and one of them is the homeowner's version of a preexisting condition. If your furnace wasn't working when you signed the contract – or dies soon after – the home warranty often won't cover fixing it.

2 Anything that fails due to something aside from normal wear and tear

If your faucet stops working because a washer wears out, your home warranty should cover the repair. If your faucet fails because your child filled it with putty, your warranty probably won't. Similarly, most contracts won't cover damage caused if your washer spews water onto the floor and into the basement. You'd have to see if your homeowners’ insurance covers that (which it probably would). AARP Membership — $12 for your first year when you sign up for Automatic Renewal Get instant access to members-only products and hundreds of discounts, a free second membership, and a subscription to AARP the Magazine. Flowers & Gifts 25% off sitewide and 30% off select items See more Flowers & Gifts offers > For example, the warns that “home warranties probably do not cover as much as you may think they do. Home warranties can have limited coverage, and might exclude kitchen appliances, water heaters, plumbing, furnaces and other major appliances.” The notes that the warranty company may consider a repair a better option than replacing your appliance. You may disagree, but it's generally up to the warranty company. Other contracts may impose annoying conditions, such as requiring you to mail parts to a factory for service or returning the item in its original carton. You should also check the company carefully. is a good place to start. Your mortgage lender, such as , may also be able to recommend a home warranty company. But beware of online consumer recommendations for home warranty companies; they may come from the companies themselves. John Waggoner covers all things financial for AARP, from budgeting and taxes to retirement planning and Social Security. Previously he was a reporter for Kiplinger's Personal Finance and USA Today and has written books on investing and the 2008 financial crisis. Waggoner's USA Today investing column ran in dozens of newspapers for 25 years. More on money AARP Membership — $12 for your first year when you sign up for Automatic Renewal Get instant access to members-only products and hundreds of discounts, a free second membership, and a subscription to AARP the Magazine. AARP VALUE & MEMBER BENEFITS See more Health & Wellness offers > See more Flights & Vacation Packages offers > See more Finances offers > See more Health & Wellness offers > SAVE MONEY WITH THESE LIMITED-TIME OFFERS