Understanding the Importance of a Structural Warranty for New Home Buyers

Ellie Brooks

Written By Clint Bird

Published 07/17/23
Understanding the Importance of a Structural Warranty for New Home Buyers

Purchasing a new home is an exciting milestone in one’s life, but it also comes with significant financial investment and responsibility. As a new home buyer, it’s crucial to understand the importance of a structural home warranty. While most builders offer a standard warranty, commonly known as a builder’s warranty, many buyers may not fully comprehend its significance. In this post, we will delve into the key aspects of a structural policy, its benefits, and why it should be a priority consideration for anyone buying a new home.

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What is a Structural Policy or Warranty?

A home warranty with a structural coverage, also known as a builder’s warranty, is a contract provided by the builder or developer of a new home. It outlines the coverage and duration of protection for various structural components of the property. This warranty typically covers defects in materials and workmanship that may arise during the construction process, ensuring that the home meets specific quality standards.

You can think of a builder warranty for new homes as a kind of guarantee. The contracted builders are standing by their work, recognizing that they have a responsibility to repair or replace some critical home element or equipment should it fail in a unreasonable amount of time.

Benefits of a Structural Policy

When it comes to a home warranty, structural coverage is especially important. Repairing things like foundations, framing, roofs, and other structural components can be incredibly expensive—often times much more expensive than replacing a dishwasher or microwave, as other home warranties are designed to do. Here are some of the most important benefits to keep in mind.

  •         Peace of Mind: A structural warranty on new homes provides peace of mind to new home buyers, as it offers a level of assurance that any potential structural issues will be addressed and resolved by the builder. This coverage extends beyond the standard homeowner’s insurance policy, focusing specifically on the structural integrity of the property.
  •         Financial Protection: The cost of repairing structural defects can be substantial. With a warranty in place, new home buyers are protected from incurring unexpected expenses related to defects that may arise within the warranty period. This financial safeguard can save homeowners thousands of dollars in repair costs.
  •         Increased Resale Value: A transferable warranty can significantly enhance the resale value of a new home. A structural warranty on existing home properties incentivizes potential buyers. The added security of a warranty, in its demonstration of the builder’s confidence in the quality of construction, is a powerful lure for otherwise wary buyers.
  •         Builder Accountability: A warranty holds the builder accountable for any covered structural defects. This encourages builders to maintain high construction standards and promptly address any issues that may arise. It establishes a professional relationship between the builder and homeowner, ensuring that the builder is committed to resolving any potential problems.
  •         Long-Term Protection: Many structure warranties cover a significant duration, typically ranging from one to ten years, depending on the builder and region. This extended coverage ensures that homeowners are protected from potential structural issues that may emerge after the initial move-in period.

Understanding Home Warranty Coverage

It’s essential for new home buyers to thoroughly understand the specific details and limitations of their warranty. Here are some key points to consider:

  •         Coverage Periods: Builder’s warranties typically have different coverage periods for various components of the home. For example, the warranty may provide coverage for the foundation, load-bearing walls, and roof for a longer duration than non-structural elements like paint or countertops. Familiarize yourself with the duration of coverage for each component.
  •         Exclusions: Builder’s warranties often have exclusions for damage caused by homeowner negligence, natural disasters, or normal wear and tear. Understanding these exclusions helps manage expectations regarding what is and isn’t covered by the warranty.
  •         Claim Process: Familiarize yourself with the procedures for filing a warranty claim. Each builder may have specific requirements and timelines for reporting structural issues. Promptly reporting any concerns is crucial to ensuring that the builder can address them within the warranty period.
  •         Transferability: Some structure warranties are transferable, meaning that the coverage can be transferred to subsequent buyers if the original homeowner decides to sell the property. This transferability can be a significant selling point when putting the home on the market.
  •         Builder’s Reputation: Before purchasing a new home, thoroughly research the reputation and track record of the builder. Look for builders with a history of providing reliable warranties and excellent customer service. Reading reviews, talking to previous homeowners who have dealt with the builder, and consulting with real estate professionals can help you gauge the builder’s credibility.

Working with a Professional Home Inspector

While a builder’s warranty provides valuable coverage, it’s still essential to conduct a thorough home inspection before finalizing the purchase of a new home. Hiring a professional and independent home inspector can help identify any potential issues that may not be covered by the warranty. They will assess the overall condition of the property, including plumbing, electrical systems, HVAC, and other components.

During the inspection, the home inspector will provide a detailed report, highlighting any areas of concern. This information allows the homebuyer to address these issues with the builder before the warranty period expires. It’s important to communicate openly with the builder and ensure that all identified issues are appropriately resolved.

When a Builder’s Warranty Expires

As a buyer of a newly built home, understanding the importance of a builder’s warranty can help you protect your investment and ensure a worry-free homeownership experience. A warranty provides peace of mind, financial protection, and increased resale value. By familiarizing yourself with the warranty coverage, exclusions, and the claim process, you can navigate the warranty effectively.

But what happens when the warranty eventually and inevitably expires? You can consider extended coverage through a third-party provider. Liberty Home Guard can offer wide-ranging home protections, are our plans commonly go beyond the scope of what builder’s warranties covers. For instance, while we cover plumbing, electrical, and HVAC equipment, we also protect kitchen and laundry appliances, home electronics, plumbing fixtures, and much more. We even support a variety of home maintenance services, from gutter and carpet cleaning to pest control and rekeying.

Find the warranty that suits your needs and budget and extends the meaningful protection on your home. Call our team at (866)-432-1283 or use our website to get a free quote in minutes.

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