Monday, June 11, 2012

Consumer Alert : Home Warranties Warning

As an injury lawyer, I seldom address consumer issues. However, if you have a home warranty, you will want to read this.

A home warranty program pays for covered repairs, and you pay a small service fee for each visit. It is usually $50-60.00. There are advantages:

1. The warranty company has a list of reputable contractors. Due to their constant business, the warranty company is in contact with contractors and they know which ones are taking care of people. That is better than just calling out of the yellow pages.

2. The warranty company is always open, and claims can be filed on line as well. This is great for landlords, who can simply let a tenant call in his problems directly and not bother the landlord to be the middle man. The tenant can also schedule a time when they can be home and alleviate that responsibility from the owner.

3. Also, most repairs are only the fee, even if they have to make multiple trips due to waiting on parts, etc.

However, having a home warranty is not without its pitfalls.

Recently, one leaking air conditioner finally gave up the ghost in a rental home I own. I was glad I had the warranty. That is, until the contractor tried to get me to pay a surprising $510.00 in addition to the $60.00 service fee!

They explained that these were for "uncovered expenses."  Here is the list:

$120.00 cleaning fee
$175.00 to redo drain pipe
$165.00 permit fee
$  50.00 disposal fee

I took issue with this. (No surprise to those who know me). I was really particularly incensed at the "permit fee." According to the local authorities, there is not--and there has never been--a permit required to simply repair a faulty air conditioner.  And $50.00 to "dispose" of something made of copper? Really? It might be worth that in just metal!

In the end, these things were not actually owed. Be aware that this is going on. Or at least it is with AHS Warranty Company.

Be advised.

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