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.
Warranty vs Agreement: Understanding the Key Differences and Types When it comes to legal contracts, it is essential to distinguish between a warranty and an agreement. While they are both legally binding, they serve different purposes and have distinct characteristics. Let's delve into the details and explore the key differences and types of warranty versus agreement. Warranty: A warranty is a contractual promise made by a seller or manufacturer to the buyer, guaranteeing the quality, performance, or condition of a product or service. It is intended to provide assurance to the buyer regarding the reliability and longevity of the purchased item. In essence, warranties aim to protect the consumer by offering remedies or replacement if any defects or deficiencies arise within a specified period. There are different types of warranties, including: 1. Express Warranty: These warranties are explicitly given, either orally or in writing, by the seller or manufacturer to the buyer at the time of purchase. Express warranties set out specific promises and representations about the product or service's quality, features, or performance. 2. Implied Warranty: Implied warranties are not stated in writing or verbally, but they are automatically imposed by law. There are two main types of implied warranties: a. Implied Warranty of Merchantability: This guarantee assures that a product is fit for its intended purpose, meaning it is of acceptable quality, adequately packaged, and free from defects. It is assumed to be automatically included in any sale unless specifically disclaimed. b. Implied Warranty of Fitness for a Particular Purpose: This type of warranty arises when a seller knows or has reason to know the buyer's particular purpose for the product or service being purchased. The seller implies that the item being sold is suitable for that specific purpose. Agreement: An agreement, on the other hand, refers to a mutual understanding or arrangement between two or more parties, outlining the rights, obligations, and responsibilities of each party involved. While an agreement may include warranties, it encompasses a broader scope, encompassing all the terms, conditions, or stipulations established between the parties. Agreements can have various forms, including verbal, written, or even implied through the parties' conduct. Typically, agreements are used to define and regulate relationships between individuals, businesses, or organizations. They can cover diverse areas such as employment, partnerships, leases, services, or sales of goods. It is worth noting that warranties can be part of an agreement, ensuring the buyer's protection within the broader context of the contract's terms. However, warranties are not confined to agreements and can stand alone as individual legal documents. In conclusion, while warranties and agreements are related, they have distinct roles and characteristics within the realm of legal contracts. Warranties provide assurances regarding the quality or performance of a product or service, whereas agreements encompass the entire scope of the arrangement between parties. Understanding these differences is crucial for both business owners and consumers in ensuring fair and secure transactions.
