One of the big advantages of buying a brand new home is your warranty. Purchasing a home is a significant investment, and you want to be certain that it is well protected.

Before you sign a contract to buy a home, make sure that you understand what’s involved in the builder’s warranty. Here are some factors to consider.

Is a new home warranty mandatory? In British Columbia, Alberta, Ontario and Quebec, builders are required by law to provide home buyers with a third-party warranty. In the rest of Canada, the decision is left to the individual builder—they may offer their own company warranty, or they may choose to belong to a warranty provider. For home buyers, the decision is easy—you want a home with a third-party warranty. It’s the only way you can adequately protect your investment if something goes wrong. A third-party warranty provider will step in and look after the problem in the event the builder is not willing or able to do so.

What's covered? As a minimum, a new home warranty should include deposit insurance and protection against defects in work and materials as well as major structural defects. Additional coverage may include defects in your home's mechanical systems or building envelope. Some warranties include living expenses to offset the cost of temporary accommodations, moving and storage if you cannot occupy your home due to builder failure or warranty repairs. You may also be able to upgrade a "basic package" and get extended coverage.

How will I know that my home is OK when I move in? As your home nears completion, your builder will schedule a walk-through, also known as a pre-delivery inspection. Together, you and your builder will verify that the home is built according to plan, with the features and inclusions specified in your agreement. Together, you will take note of any imperfections and defects that require attention, down to the smallest detail—a sticking drawer, a scratch on the wall, and so on. Your builder will explain how and when these things will be dealt with—most items are usually corrected before you even move in. You will also be shown how to operate the systems in your home, such as heating and ventilation, and how to take care of the many components in your home to ensure long-lasting performance.

Following the walk-through, you will be asked to sign a certificate of completion and possession. This certificate triggers the warranty coverage on your home.

What if I run into a problem with my new home? If you have questions about your home, encounter any problems or need service, follow the process set out by your builder.

In the event that your builder is not responsive to your needs, the third-party warranty provider will ensure appropriate action, including mediation between you and your builder. If the builder is not performing the needed warranty work, the warranty provider may arrange to have it done on your behalf, or they may ask you to look after it and will reimburse you afterwards. Ask your warranty provider about their approach to warranty work.

Expectations and responsibilities. What are the builder's obligations and performance standards? What are the company's after-sales service standards and process? What are you responsible for once you move in? What do you need to know in order to avoid problems in your new home?

Good communication is key to avoiding conflict between you and your builder. Don't hesitate to ask your builder for answers to these and other questions. Warranty providers also offer detailed consumer information, including home maintenance, online, or you can request written publications. Many also have excellent advice on home buying, such as what to look for in a builder and the steps involved in homeownership.

New home warranty—another great feature of your brand new home.

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