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5 Home Warranty for Rental Property Pitfalls

Chris Claflin - Wednesday, January 17, 2024

As a landlord, one of the most important decisions you have to make is whether or not to offer a home warranty to your tenants. While home warranties may seem like a great idea, there are actually many pitfalls that make them a headache for both landlords and tenants. In this post, we will discuss the top five pitfalls of home warranties and why you may want to reconsider offering them for your rental property.

1. Response Time

The first and most crucial issue with home warranties is the response time. These companies do not prioritize urgent repairs and often take days, if not weeks, to send a vendor to fix the problem. This is a major problem for both landlords and tenants, as the tenant is left without essential amenities and the landlord is left dealing with angry tenants and potential legal issues.

Furthermore, in North Carolina, there are strict statutes regarding response time for repairs, and home warranty companies often do not comply with these regulations. This can lead to costly legal consequences for landlords.

2. Lack of Vendor Control

The second issue with home warranties is the lack of control over the vendors they use. These companies often contract with the cheapest and least experienced vendors, who are desperate for business. This means that the quality of work and professionalism of these vendors may not be up to par, leading to further complications and potential repairs.

3. Limited Coverage and Price Gouging

Home warranty companies are notorious for excluding many items from their coverage, leaving landlords and tenants with unexpected out-of-pocket expenses. In addition, the vendors they use may take advantage of the situation and charge exorbitant prices for repairs that should be covered under the warranty. This can be a major financial burden for both landlords and tenants.

4. Lack of Communication

Communication is key in any business transaction, but unfortunately, home warranty companies do not prioritize keeping landlords and tenants informed. They often do not provide updates on the status of repairs, and the only notice a landlord may receive is when the vendor shows up unexpectedly. This lack of communication can be frustrating and time-consuming for all parties involved.

5. Immediate Payment Demands

Lastly, home warranty companies demand payment upfront, often before the vendor even starts the repair. This can be a major inconvenience for landlords who may not be available to provide payment on the spot. It can also lead to delays in repairs if the landlord is unable to provide payment immediately.


While home warranties may seem like a good idea, they often cause more problems than they solve. As a landlord, you want to provide the best possible experience for your tenants, and home warranties can hinder that goal. It is important to carefully consider the potential pitfalls and drawbacks before offering a home warranty to your tenants. As always, it is best to consult with a professional property management company, like Sunnon Property Management, for expert advice and guidance on managing your rental property. Looking for other DIY Landlord tips and tricks? Checkout our free e-book full of goodies!