Tips On Home Warranty Coverage For Home Owners

A one-year warranty or longer is what most new-home builders offer at the least. Even when the builder doesn't have a written warranty, in 42 states and the District of Columbia, there is an implied warranty that compels the builder. When there is a dispute, you may have to go to court, however. Usually, when there's a problem, the best action is to write a letter straight to the owner or head of the home-building company.

More than 12,000 home builders nationwide are members of the Home Owners Warranty program, or HOW. The HOW plan, patterned after a standardized program in

England, was started in 1974 by the National Association of Home Builders.

The HOW plan offers protection against major defects in a new house that can cover up to 10 years. Several homes have been enrolled in the program, which also allows ease of pursuing your complaint without going to court. Here's how HOW works:

First year: The builder gives an assurance to fix major flaws in workmanship and materials and in primary systems like plumbing, wiring, heating and cooling, ventilating, and mechanical. This also includes major structural defects caused by noncompliance with HOW's Approved Standards for Construction. Some areas, like driveways, aren't covered.

Second year: The warranty keeps on covering defects in major systems and major structural defects.
In first and second years, HOW's insurer backs the builder's warranty and does the needed repairs if the builder is not able or unwilling to do the warranty work. A one-time deductible of $250 is charged to work executed by HOW's insurer.

Third through 10th years: The builder has HOW insurance to cover the cost to fix

major structural defects. Once again, a $250 deductible is applied to each major structural defect claim.
If, throughout the warranty period, a dispute comes up over the warranty and the times that are covered, and the builder and the homeowner could not agree, then HOW's Expedited Dispute Settlement action comes to your aid.

For example, you have a complaint, then you notify HOW that you and the builder can't seem to agree. HOW would then contact the National Academy of Conciliators to get a mediator assigned to the case. The mediator sets up a meeting with the homeowner and the builder at your home. You are given the home-field advantage. When the mediator could not mediate an agreement, he or she would issue a decision that is binding on the builder, if it is acceptable by the homeowner.
When the builder is determined to be responsible, he is compelled to make the repairs. If he doesn't, HOW's insurer makes certain the repairs are done by someone else. In either case, the homeowner still gets the repairs under his warranty coverage.

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