Your builders warranty safeguards you from the old adage: if it can go wrong, it will go wrong. Be it bad luck or bad brickwork, with a good warranty in place you can freely walk under ladders and throw away that rabbit's foot (also, because, ew).
The last thing you want when settling into your new home is to worry about faulty workmanship and the cost of fixing things that break when they are literally brand new. Enter your new home warranty, insurance coverage that protects you against construction defects for a specified amount of time.
Before you sign on the dotted line with the builder you’ve eyed out, it’s good to understand how a warranty works and what all it entails. Here, we've laid out the basics in a brief 7-point guide, well, just for you.
1. You can’t take it with you.
A new home warranty is for the home, not the owner of the home. So, if you up and sell after two years, the new owners will inherit the remaining term of the warranty.
2. Party, party, party.
The warranty is taken out with a registered home warranty insurance company by the builder of the home, not the owner. The insurance company is the third-party, so the warranty is often referred to as a third-party warranty.
3. Either ORs.
The warranty kicks into effect when any one of these three things happen: you take occupation of the home; OR the permitting authority grants you permission to occupy the home; OR the title of the home is transferred into your name.
4. Death, taxes and home warranties.
Every new build should come with a warranty. In British Columbia, Alberta, Ontario and Quebec it is mandatory. In other provinces, it’s left up to the builder, but members of the Canadian Home Builders’ Association are required to offer a warranty as a condition of their membership.
We’d definitely agree that it’s wise when shopping for a builder to consider only those who provide a warranty. Because life has a habit of happening.
5. Pushing the envelope.
Generally speaking, a new home warranty will include deposit insurance, plus protection against defects in work and materials, and any major structural defects. Additional coverage could include defects in your home's mechanical systems or building envelope. Some warranties include the –
- Hold up – did you just say building envelope? Huh? The building envelope is the layer that separates the exterior of your house from the interior of your house. Weird term, we agree. The envelope encompasses the entire exterior building system of your home, including your roof, foundations, floors, doors, windows and insulation – essentially everything that separates you from the elements.
Right, where were we? Some warranties include living expenses to offset the cost of moving, and storage if you cannot occupy your home due to builder failure or warranty repairs (plus the cost of temporary accommodation in such circumstances). You may also have upgrade options on your package which can include extended coverage.
6. 2 – 5 – 10, eight, who do we appreciate?
Warranty coverage almost always works on a 2-5-10 model. This refers to the number of years before the coverage of certain construction faults expires. It means you are covered for:
7. What do you mean you don’t cover raccoon raiding?
Now, let’s take a look at what isn’t covered by the 2-5-10 home warranty. Here goes:
shrinkage of construction materials
normal wear and tear
landscaping
septic systems
site drainage
other buildings on the property including detached garages and sheds
any materials or labour supplied by the owner
municipal services
water quality
forces of nature
animal damage
commercial use areas such as roads, curbs, sidewalks.
Finally, your home won’t be covered if it’s being used for non-residential purposes, or if you
fail to “avert or lessen damage to the home”.
If you skipped straight to here.
What’s the take home? It’s super important to choose a reliable builder with a good warranty. Building your own home is a big deal. It’s an incredibly special and exciting time where you fill a blank canvas to paint with all the millions of little memories that make up a life. A good warranty stands guard at the door and says: “Not today Murphy.”
Original article from rew.ca