What happens if the roof on your newly constructed home starts to sag a month after you move in? If only you could snap your fingers and make the problem go away. Things are never quite that easy, but if your house came with a builders warranty you have a better chance of getting it replaced at no cost to you.
If you’re contracting for a newly constructed home, a builders warranty should be a key aspect of the deal. Not all warranties are created equal and it’s important to understand what yours covers and how it works.
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Builders Warranty: What’s Covered?
The specific components covered in the warranty can vary, but they are generally broken up into two parts:
1. Workmanship/Materials
One part of the agreement covers the workmanship and the materials used in the construction. A variety of components fall under this umbrella, such as:
- Exterior siding
- Roofing shingles
- Windows
- HVAC system
- Insulation
- Septic
- Plumbing
- Electric
- Waterproofing
2. Structural
The other part covers the structural aspects of the construction, particularly anything that would impact the structural integrity of the home, like a defective foundation or a roof.
Builders Warranty: What’s Not Covered?
Warranties can give you some peace of mind, but they are not a catch-all for every little (or big!) issue.
General Wear and Tear
Once you start living in a house, damages will naturally occur as a result of normal aging. Examples include paint fading or small hairline cracks developing as a result of the house settling.
Defects Caused By the Owner
Issues resulting from homeowner negligence or misuse aren’t covered. Say your child flushes a stuffed animal down the toilet and causes a sewer back up. It may go without saying, but something like this would be outside the scope of the warranty.
Household Appliances
The failing of a stove, refrigerator, washing machine, etc. typically isn’t the builder’s problem. Sometimes these items come with a manufacturer warranty, which should be passed on to you by the builder. If not, you may consider purchasing additional insurance for these pieces of equipment through a home warranty.
Ongoing Maintenance
When it comes to homeownership, maintenance is par for the course. You would be hard-pressed to find a warranty that covers contracted services for ongoing maintenance, like pest control.
Natural Disasters
Acts of God, such as an earthquake, flood or hurricane, can cause serious damage to your property, but will likely fall outside the builders warranty. The costs to make repairs after major events can sometimes be recouped by a home insurance provider.
How Does a Builders Warranty Work?
As part of the agreement, it’s important that you understand the deadlines and the process for submitting claims.
Stay on Top of Deadlines
Warranties don’t last forever, so you want to keep tabs on the deadlines. Some aspects covered by the warranty may have a quicker expiration than others. For instance, coverage for material defects may only last as little as a year, while structural components may have a longer term, like eight or 10 years.
Who Backs the Builders Warranty?
The builder could back the warranty or it could be processed by a third-party insurance provider. You’ll want to know upfront whom you’ll be dealing with should any issues crop up.
How Do You Submit a Claim?
It can be reassuring to know that someone else may be on the hook for fixing defects with your home, but how do you actually go about holding that person responsible? The warranty should spell out the process for submitting a claim either by written notice or over the phone. Even if the primary method of submitting claims is through a hotline, you should still document all correspondence in writing.
Tips for Building Your Builders Warranty Claim
A builders warranty can give you some security, but don’t let it give you a false sense of protection. As with many things in real estate, situations aren’t always cut and dry. When property components start to break down, it can be hard to determine who is at fault. If the central air stops working in your house, is it truly defective or did you overload the system?
Put yourself in the shoes of the builder: He or he doesn’t want to be nickel and dimed for every little thing that goes wrong. That being said, problems can arise that fall squarely on the builder’s shoulders. Some builders take claims seriously and will take accountability and others will fight you tooth and nail.
One of the best things that you can do is have your home inspected prior to closing. Often times, a home inspector’s trained eye can pick up on things that are easy for the layman to overlook. For instance, a small slope in the floor could be nothing or it could be signs of a shifting foundation.
One of the best things that you can do is have your home inspected prior to closing. Often times, a home inspector’s trained eye can pick up on things that are easy for the layman to overlook.
It’s also smart to have the home re-inspected before your warranty expires. If you feel like something is not right, having the condition of your home documented by a neutral party will help to build your case. You may want to procure quotes from licensed contractors to fix the issue, but be careful about having any work performed as this could void the warranty.
Contact the builder or warranty provider as soon as possible so that your claim falls within the warranty period. Deceptive builders may try to run out the clock on a claim so that the warranty expires. Be sure to have all notifications dated and in writing as you may need to use the correspondence in court.
If your builder is not taking accountability for a major problem, you may need to consult a lawyer or pursue other avenues. Take the example of a defective heating system: It may be worth contacting the manufacturer directly or the subcontractor who installed it to see if there’s anything he or she can do.
With some persistence, you can resolve many common issues associated with a new construction home with the builder, the manufacturer or the subcontractors involved in the project.
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