Tips from an HOA Board: What to Look for in Home Warranties

As a homeowner, you probably received a new home warranty when you purchased your home - many owners within your homeowners association may also have one. If no major problems have been encountered with your home, then you probably have not read the home warranty paperwork, but you should!

While most builders & developers are reputable and provide legal and fair warranties, some do not. And too often, home warranties can be complex, ponderous documents that are difficult to decipher. Some warranties waive the homeowner’s right to a jury trial if he or she files a construction defect claim.

Others may include liability disclaimers and waivers for some builders’ construction defects. And occasionally, a warranty may include terms that are not enforceable under state law, although you or other homeowners may not realize it.

Make Sure Your Home Warranty Protects You

It would be a good practice to have an attorney review it and check for the following provisions:

• Can you engage an engineer to represent you to determine the nature, cause and extent of the construction problems?
• Can you pursue a mediation conference with the builder to resolve disputes?
• If the builder expects binding arbitration, who selects the arbiter—you or the builder?
• Can the warranty period be reset when repairs are completed?

If you believe that you are bound by an unfair warranty—or even if you aren’t sure you understand your home warranty – the smart thing to do is consult an attorney who specializes in homeowners association law or construction defect law.

This information might be helpful to pass along to owners within your Association, so that they are protected should an unexpected need arise!