What is a Home Builder’s Warranty Agreement?
When a new construction home is completed by a home builder, the client should be confident that the manufacturer or seller they’ve hired will provide high-quality products and perform high-quality work. In the construction industry, client confidence becomes even more critical as the high standards expected of contractors directly impact safety. In such situations, warranty contracts come in handy.
A construction warranty is a legal document in which the contractor provides a covenant that guarantees to the client (homeowner) that they will perform all works following building codes and standards and project specifications without flaws or defects. Breaching such an agreement results in monetary recovery of related damages and costs for material replacement or reparation works to be carried out at the contractor's expense.
The Magnuson-Moss Warranty Act, a US federal law enacted in 1975, regulates warranty contracts. It states that while not all products and services require written guarantees, if parties conclude one, then such an agreement must comply with the Act. This law aims to prevent manufacturers from misleading clients with inappropriate and unfairly made disclaimers on the guarantees.
Types of warranties
There are two general types of contractor warranty agreements:
- Express warranty is a written or verbal guarantee from the seller that the purchased product is of a certain quality and that the seller can replace or repair it if there are any defects.
- Implied warranty is a guarantee that the purchased product operates as it should.
Builders’ warranties operate under another classification because of industry specifics:
- Time-based warranty is the contractor’s promise to provide a particular thing in a defined condition at a specified time (for example, to guarantee the construction is waterproof for a certain number of years).
- General warranty is a guarantee to perform defined works according to the project blueprints and specifications without a time reference.
Preparing a new Home builder warranty To complete your paperwork correctly, use a verified home builder’s timely-based guarantee agreement from the US Legal Forms library. This multi-state editable and printable legal template requires you to fill out the following information:
- Name and contact details of the contractor and the buyer;
- Newly-constructed house description;
- List of items that are under builder’s guarantees (can be expanded);
- List of items the builder doesn’t take responsibility for (can be changed);
- Name of the state that will govern the agreement.
A Standard one-year builders warranty for new construction is a common guarantee provided by home builders to ensure quality and address possible defects or issues with the newly constructed property. It explicitly covers the buyer against construction-related problems that may arise during the initial year of ownership. This warranty offers reassurance to homeowners, protecting their investment and giving them peace of mind. Under the Standard one-year builders warranty, builders typically commit to repairing or replacing any faulty workmanship or materials discovered within the first year of the property's completion. This coverage fulfills legal requirements and is widely considered an industry standard. It serves as evidence of the builder's commitment to deliver a structurally sound and functional home. The Standard one-year builders warranty covers a broad range of components within the house, encompassing both visible defects and hidden issues. It often includes electrical, plumbing, and HVAC systems, as well as interior finishes, such as flooring and paint. Exterior features like roofing, siding, and windows are also typically within the warranty's scope. While the general concept of the Standard one-year builders warranty remains consistent, variations may occur depending on the jurisdiction and specific builder preferences. Some builders may offer extended warranties beyond the mandatory one-year coverage, providing additional protection to homeowners. These extended warranties often cover major structural elements such as the foundation, load-bearing walls, and roof for an extended period, typically up to ten years. Furthermore, certain areas may have statutory regulations defining builders warranty requirements, setting minimum standards for protection, and establishing dispute resolution procedures. It is crucial for homebuyers to familiarize themselves with these local laws and regulations to ensure adequate coverage and address any potential conflicts. To summarize, the Standard one-year builders warranty for new construction acts as a safeguard for homeowners against potential defects or deficiencies in their newly built property. It assures buyers that builders will rectify any construction-related issues discovered within the first year, providing assurance and protection throughout this initial period of homeownership.
