Home warranties for buyers of real estate in Salem Oregon | Get Real Estate Blog|Salem Oregon Homes|Relocation Guide

Posted by melina@tomsonburnham.com on February 20th, 2009

Home warranties…

AHS or American Home Shield is a large provider of home warranties here in the US. Home warranties have long been popular with real estate agents to reduce the risk of claims against we agents for misrepresentation…A home warranty will take care of it, many agents assure themselves.

I have never been a fan of them because…well…I think the service stinks for the most part. That has been my experience and was dismayed to find that they added a section in our real estate contracts this year to talk about home warranties to make sure agents “talk to our clients” about them.

So, AHS recently announced a class action lawsuit settlement for…breech of contract. Pretty much you paid for a warranty and when it came time to fix something…they didn’t claimed the plaintiffs. Now some people have had a positive experience with AHS, but some haven’t, hence the lawsuit.

So…the details

You can file a claim if you purchased your home warranty (or one was purchased for you in a real estate transaction) after July 24, 2001 and you were denied service. I’m not sure what special event happened on July 24th to be honored with the starting time frame, but there it is. It takes any denied claims though December 31, 2008.
AHS is admitting no wrong doing and is adamant about their position on this. For the sake of legal fees is agreeing to the settlement.

So…you can find information about the settlement offer and information about the lawsuit. Or here is a snippet about how to file a claim

http://columbusbestblog.com: Maureen McCabe

I like home warranties. Or I am used to them. I believe we’ve had something in our purchase contract since 1990 that brought up the subject when the contract is written. A lot of sellers already have them in place on the property.
melina@tomsonburnham.com

We’ve had something about them in addenda, but not in our actual contract until this year.

I like the idea of them for homeowners, but I’ve just found the execution not great.
http://www.repdx.com Ron Ares

Have you had better luck with Fidelity or First American policies?
http://www.perfectioninspectioninc.com Jim Allhiser

This is very interesting. AHS also offers a 60 and 90 day waranty for home inspections. Again the idea was good however the exacution for me was tedious. I never got on board. Now this. I guess it is hard for a waranty company to make money paying on claims.
melina@tomsonburnham.com

Jim I think the problem is the nature of their business. I mean the warranty clearly states that it has to be a maintained product to be covered under the warranty.

That isn’t how it is presented to buyers though. I have heard agents tell people, yeah if the furnace goes out you get a new one..

That’s not always the case. I think there were some abuses by consumers trying to get something for free that they didn’t maintain.

I also think it depends on the local contractors hired to do the service. Some are good and some aren’t.
melina@tomsonburnham.com

Ron,
I have only had a couple of clients get a First American warranty, and both are still in their one year period. They haven’t had to use it yet so I have nothing to say about them. I’ve never used Fidelity.
beckyK

We had AHS. Twice we had authorized repairman out to look at why our AC system was leaking freon. Twice they charged us the 50.00 deductible and just put in more freon. We dropped AHS and had someone else come out, our condenser was cracked, needed replaced, and because the freon ran dry our compressor was also damaged and had to be replaced. AHS ripped us off.
colleen

I paid for First American policies for 7 years and when we finally used it, we had a bad experience with the contractor. bad enough for me to stop using them and switch to AHS. all are risks as you are dealing with the company and individual contractors so your experience relies on their work ethic and integrity.

melina@tomsonburnham.com

Colleen,
I agree that the individual contractors they use will make or break it. One of the AHS contractor’s out here is the plumber I use and recommend. So I know people would be taken care of by him in my area.

I like the idea of home warranties, especially for first time home buyers, but I’m not sure how to have those companies make sure they are getting quality contractors. Maybe if they have some feedback system, they could weed out bad contractors faster…

Ted Pittman

We received a “Home Warranty” through AHS when we purchased our home in 2005. We attempted to utilize the warranty in 2006 and were refused.
My question is how do we become a member of the currently Class Action lawsuit against them.

Melina Tomson

Ted the information for this is in the post. You have to qualify to be a part of the suit. The address is in the box.

vince

I got a AHS warranty when I bought my home .tried to make a claim about a plumbing issue. they would not cover it.then when the coverage was about to expire they kept asking me to renew. yeah right!

Melina Tomson

Vince I think that was the gist of the class action suit. I also think that some real estate agents tell clients that the warranties “cover things if they break” but there are some restrictions on them.

Lorilyn

I have a home warranty through AHS; I received the policy as part of a home purchase in 2008, and I renewed it in 2009. I have used it recently for the first time, and although the contractor seemed reliable and trustworthy at first, the problem still has not been fixed. I have called him no less than 5 times to come back and try to fix the problem. I cannot be certain that he actually came back each time (2-3 out of the 5 times he did not reply to my message or leave any paperwork to verify that he was here, but the unit worked temporarily after the call). I am not sure if the problem lies with the contractor or with AHS. I have heard from others that AHS tries very hard to repair a problem in the absolute least expensive way, and frequently does not follow the contractor’s recommendations for proper repair of the problem, thus resulting in what is effectively a temporary fix or “band-aid on the cut,” so to speak. Is this true, and if so, what are my rights?

Melina Tomson

Lorilyn I have no idea what your rights are. You need to read your AHS contract and see what it says your rights are. I know that’s not what you want to hear, but what recourse you have will be outlined in your contract.

http://www.seth-hill.com Seth Hill

WARNING! If you search web sites about AHS, it is very obvious that their standard business practice is to collect premiums and provide no service. We had their “insurance” for several years, and we learned the hard way all the tactics they use to deny repairing anything. Folks, I am not exaggerating; they DO NOT repair anything. The current class-action lawsuit against them is at http://faughtclassaction.com

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