Help Fighting Home Warranty Company

[dx3]

Guys,

Was wondering if anyone had any advice for me. When I purchased my home, I had full inspections done, including Structural, Mechanical, Plumbing and Electrical. Part of the contract for buying the house, was that the seller include a home warranty for one year on the home - which the seller did.

Well, as it hits 27 degrees here my heating stops working. I call the Home Warranty company who sends someone out to look at it. The Heating guy said that it is in bad shape and the heat exchange is badly rusted - making it dangerous even if it was working.

So, he calls the Home Warranty company and tells them it needs replaced. They tell him they will not cover it because it was pre-existing. Although I agree that this has happened over time, the heating unit passed inspections when I bought the house.

It is a 5-ton unit so I am looking at $5800 if they don't pay for it. Could make for a very crappy Christmas for my family. Any help or suggestions...?

Thanks guys,
Jonny

 

[nsxotic911]

I know this is not encouraging, but home warranties are cheap ($300 bucks? ) and strategy of the seller to pay for it to make the buyer feel more warm and fuzzy when they buy the house. I did this when I sold a house...

It's known within the RE industry that they aren't valuable if/when you need to use them. It's like many car warranties..

I don't know if you purchased the warranty intentionally, or if the seller provided it.

Some options might be:
1.) Call them and talk to the most higher up person you can, speak professionaly and respectfully but firm that you feel jipped and that you expect them to pay for it, and if not, you will take all reasonable means including legal avenues to collect the cost of the repairs.
2.) Have your attorney or a cheap prepaid legal service like www.prepaidlegal.org to write a letter.
3.) Compain with the BBB (I'd be surprised if there are not many complaints already)
4.) Do a charge-back if you still have time.. might just be able to get your money back, maybe, but it probably won't get them to fix it.
5.) Do the work, send them a bill, sue them...

I know it's not very encouraging; good luck.

 

[Daedalus]

There is wording in the home warranties to get them out of paying for just about anything the could possibly go wrong. I wanted to file a claim for leaking pipes, but there was an exclusion for any damage caused by rust or corrosion. The only satisfaction you're likely to get is the hearty laugh you can give the telemarketer when they call you to renew at the end of warranty period.
On the other end, you'll find all kinds of protections for the inspector too, so he's not liable for anything he missed. The whole thing is gov't backed crime as far as I'm concerned.

 

[Red]

On rusted heat exchangers - I am an expert.

I have an indoor pool and the pool pump room, and my furnace room are one and the same! In the room there are four (yes, stop making fun of me) furnaces (larger house and the four are used to provide "zones" ie 2nd floor, main floor, basement, and pool)

All four heat exchangers have rust on them, lots of houses have rusted HEs, because they're not made of stainless after all, but mine are more rusted from the damper environment.

The issue is that a "bad" guy will try to make extra $$$ selling you a full furnace "heat exchanger is gone, unit is old, better buy a new one" as he thinks of all the new shit he's gonna get fro xmass with your $$$!

The issue with HE's being rusted right through is that you MAY have CO (carbon Monoxide) leak into your house from the heated forced air crossing the HE.

Get some (lots, we have two upstairs one just outside of furnace room, etc.) CO Detectors and stop worrying - a LEGIT guy can measure the CO put out through your ducts - probably none if the first inspector didn't have a problem with the rust on the HE!:wink:

Now, is there actually something wrong with your furnace? If so, what is the problem/symptom?

Fight the company if you want, but fix the problem on your own!

(BTW, a common way of rusting a HE is having the AC unit not drain perfectly or the fan isn't running well so the AC unit builds up frost - the moisture can rust the HE which is generally 18 inches or so below the AC)

 

[steveny]

Before you install a new heating system PM me about the system I just installed in my NY house. This thing is state of the art and will cut your heat bill by 50% or more. As well it converts ac to dc power for the blower part of the system and will also decrease the cost of electricity to run the system by as much a 80%. I have already seen a huge improvement in the quality of heat and how even the heat is. I also installed a hot water on demand system at the same time and a new A/C system. The total cost was very cheap overall as I expect to save almost $3.5k a year on the heat end and almost another $1k a year on the electric end. In less than 2 years the system will pay itself back. Rheem is the manufacturer.
I would love to see some more household equipment use the ac/dc conversion method, it saves a ton of electric usage.

 

[NsXMas]

Steve - please share more details.

 

[steveny]

I don't know what the model of the furnace is until I get back to NY. I can check it and post the model then.

this one looks close but it doesn't say anything about the ac to dc conversion. it also doesn't say that it is a 98% unit either. but it is close. Check out the variable gas valve. really has some great features to save lots of money. And quite is an understatement. I had to touch the thing to be sure it was running.

http://www.rheemac.com/products/Pro...ting&Category=Gas Furnaces&SpecificModel=RGGD

 

[dx3]

Now, is there actually something wrong with your furnace? If so, what is the problem/symptom?

Fight the company if you want, but fix the problem on your own!

(BTW, a common way of rusting a HE is having the AC unit not drain perfectly or the fan isn't running well so the AC unit builds up frost - the moisture can rust the HE which is generally 18 inches or so below the AC)

Awesome information man - thank you.

Basically it has completely stopped working on the heat side. AC runs just fine. I guess the heat exchanger has completely rusted shut. Something starts burning when they get it on and the fan doesn't turn on anymore.

Could you please explain more about why the HE would rust like that? This is what I need to bring to the warranty company in my defense as to why it passed inspections 8 months earlier without any problems.

Steve - we actually have the house on the market so are trying not to dump anymore money into the house than absolutely necessary...

Thanks again guys,
Jonny

 

[steveny]

Awesome information man - thank you.

Basically it has completely stopped working on the heat side. AC runs just fine. I guess the heat exchanger has completely rusted shut. Something starts burning when they get it on and the fan doesn't turn on anymore.

Could you please explain more about why the HE would rust like that? This is what I need to bring to the warranty company in my defense as to why it passed inspections 8 months earlier without any problems.

Steve - we actually have the house on the market so are trying not to dump anymore money into the house than absolutely necessary...

Thanks again guys,
Jonny

The heating system I was recommending is less than the 5800 dollars you were quoted.

It is unlikely the HE was not cracked 8 months ago. It is also unlikely the home inspector was able to see the crack. what has happened to your He happened over a long period of time and there is little you can do to prevent this from happening on almost any furnace. Most modern heating systems have a life span of 20 or less years. Some of our apartment buildings have heating systems in them that are 50 years old and still working fine, problem is they aren't very efficient. I have seen some older systems with 1/4 thick HE's. You won't be getting anything like that in todays market.
If you are going to sell the house look for a good used furnace and install that, assuming the house is older and a used system would not look out of place.