Front facing view of a large two-story home. Builders warranties.For many people, a new construction home means peace of mind when it comes to the quality and condition of the property. Like any new product, however, things can go wrong, and warranties are important. That’s why builders’ warranties exist.

A builder’s warranty is a promise to repair or replace certain parts of a home if they don’t hold up as expected. Some of these warranties are backed by the homebuilders themselves, while others are provided through independent companies. Supplemental warranty coverage may also be available through third-parties, which builders are required to supply for buyers who use Federal Housing Authority (FHA) or Department of Veterans’ Affairs (VA) loans*.

Like all warranties, builders’ warranties can vary greatly, and it’s crucial to understand what’s covered, how claims are made and how disputes are resolved.

The typical warranty for a new construction home will have terms like these:

  • Limited coverage on workmanship and materials for home components such as windows, siding, doors, roofs or plumbing, electrical and HVAC systems
  • One to two years of coverage for components and up to a decade of coverage for major structural elements
  • Guidelines for how repairs will be made and by whom

There are several notable items that builders’ warranties usually don’t cover:

  • Household appliances
  • Tile or drywall cracks
  • Irrigation systems
  • Components covered under a manufacturer’s warranty
  • Expenses incurred due to a warranty repair (e.g. paying to store belongings while a repair is made)

Before closing on your home, you should request a copy of your warranty package, which will typically include answers to these common questions:

  • What does the warranty cover?
  • What does the warranty not cover?
  • What is the process and timeline for submitting a claim and having it fulfilled?
  • Is it possible to dispute a denied claim?
  • What is the extent of the warranty provider’s liability?

To dig even deeper, you can ask for past projects and homeowners the warranty provider has worked with who you can contact to learn about their experiences.

This information will help you know where you stand should repair needs arise after you purchase your home. Together with homeowners insurance and options such as a home warranty, good builder’s warranty coverage will help insulate you from potential major expenses, keep your home in good repair and provide valuable peace of mind.

*Draper and Kramer Mortgage Corp. is a private corporation organized under the laws of the State of Delaware. It has no affiliation with the US Department of Housing and Urban Development, the US Department of Veterans Affairs, the US Department of Agriculture or any other government agency.