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Considering a Home Warranty for your Rental Property? Think twice and read this article.

System - Friday, March 26, 2021

Property owners believe that having a home warranty for a rental property is a great idea and a more cost-effective solution. Well, let me explain why we have found this to be far from accurate. The Mauzy Properties team has seen over the last 11-years of property management that home warranties are more of a nightmare than a benefit to homeowners and tenants. Home warranties can work well for your personal property or newer homes, but our opinion is that they are bad news for rental properties and the tenants living in them.

Home Warranty Inclusions

Most of the home warranty policies will include heating, air conditioning, plumbing, minor electrical, garage door openers, etc. However, you can upgrade to a premium policy. A Premium policy will likely have coverage for appliances, pumps, roof repairs, sprinkler systems, and spa tub motors. A typical home warranty policy ranges from $350-$800 per year, which breaks down to approx. $30 – $70 per month.

Most warranties have a deductible or service trade fee of $69-$125 per item, per repair, on top of the yearly price. Say you have a dishwasher that breaks down and a backed-up sink, you will have to pay two deductible fees, making the contractor’s minimum fee $138. Most likely, this will not even include the cost of parts that gets tacked on.

Home Warranty Denials and Exclusion

Home warranty companies have a slew of exclusions that tend to leave the door open for a denial of the claim. Based on what we have seen, we have compiled a small list of items that a home warranty company has the right to deny a repair claim.

  • Pre-existing problems
  • Outdated HVAC system
  • Code violation
  • Lack of maintenance
  • Incorrect installation
  • Poor maintenance

This list can go on for what they will/can deny coverage on, rendering your policy useless in getting repairs completed on your rental property.

When it comes to plumbing, the warranty will cover the repair but will not cover any drywall or concrete opening. Let’s say you live in an area with severe weather conditions and your pipes freeze; this is also an exclusion under your home warranty policy.

Unnecessary Hurdles to Overcome

Tenants expect repairs to be done right away and could care less about the home warranty holding up the necessary repair. With a home warranty company, there are many layers to getting a repair done.

  1. The tenant calls into Mauzy Properties.
  2. Mauzy quickly calls the home warranty company.
  3. The home warranty company issues work orders out to various repair companies.
  4. Repair companies call the tenant to get it scheduled (the scheduling call can take up to 7 days).

The steps above can delay a repair for up to 2-7 days which causes the tenant to become irritated. If it is a pricey repair, the home warranty company will want a 2nd opinion, the process then starts over with a new repair company. Here lies another delay on the repair and an even more frustrated tenant. While it is true, you can place a request online with a Home Warranty company; this is not feasible or allowed for a tenant or a property management company to handle.

Then there is the issue with paying the required deductible. Most home warranty companies require payment for services rendered before they will even go out to the property. I don’t know about you, but paying for a service that is not yet completed, makes me a little nervous. Creating yet another hurdle to overcome just to get a simple repair completed.

Tenant Dissatisfaction with Home Warranty Companies

As the property management company, it puts us in a sticky situation because we have no control over repairs. We don’t know who is doing the repair, no accountability for the repair to be completed timely and correct. These issues hurt the management company with a low satisfaction rating from the tenant.

Satisfaction is the #1 priority for Mauzy Properties as the customers (owners and tenants) happiness is of utmost importance to us. With poor maintenance, many tenants will complain, get frustrated, and ultimately not renew their lease. When a tenant doesn’t renew their lease, owners, in turn incur additional fees and risk vacancy, then electing to cancel their management contract with us. This is why having the right people to take care of maintenance is key to any property management company’s survival.


Here at Mauzy Properties, we have created a unique process for handling repair requests. The tenant can go online and place a maintenance request at their convenience. We receive the work order and process it quickly, assigning it to our in-house maintenance tech or a licensed vendor to handle the repair. Take that same broken dishwasher and backed up sink example; it would be assigned to one employee technician or plumber that can handle both repairs, resulting in only one trip charge.

Satisfaction guaranteed- we survey every tenant that submits a work order. We want to make sure our maintenance technician or contractor was on time, dressed for the job, completed the repair, and cleaned up afterward. If there is an issue with the repair or service, we handle it internally and promptly. On the flip side, if the work was done right, on time, etc. we recognize the employees or contractor for doing a great job.

These things add up to increased tenant satisfaction; in turn, they stay longer in your home or property. Decreasing vacancies, saving you money on needless deductibles for repairs that will most likely get denied, and ensuring repairs are completed. For more information on Mauzy Properties and the services we have to offer, contact us today.