Are They Really Warranties?

Custom Home Builders and sellers of new homes often provide “warranties” from warranty companies at the time of purchase. These warranties claim to offer the consumer extra protection. However, in reality they primarily dodge liability for the home-builder and severely limit the consumer’s rights. The South Carolina Court of Appeals has ruled in Smith v. D.R. Horton, Inc. that a warranty from Residential Warranty Corporation (RWC) was unconscionable (i.e. so grossly unfair as to be unenforceable). Maryland, D.C, and Virginia builders that are considering using these warranties should take heed. State consumer protection agencies may begin taking legal action against you if you do. Consult with an experienced construction law attorney and discuss the pros and cons.