Michelle and Alon Frumer have discovered the hard way that a new home is not a guaranteed route to trouble-free home ownership. What's more, home warranty companies are not all they're cracked up to be either, according to Angie's List, an online service rating companies that provide home warranties, and in some cases an extended warranty, to homeowners who have purchased a newly constructed house.
The online review company reported recently that for the seventh year in a row, home warranty companies took the dubious distinction of having the worst ratings and grades amongst service providers last year, according to Angie's List.
The Herald News of Passaic County, New Jersey (2/12/12) recounted the frustrating events surrounding the purchase of a large home by the Frumer family in 2008. Located in Englewood, the large home valued at $997,000 had recently been built by an independent contractor. As the home was new, the family decided against employing the services of a home inspector, assuming the home would have been properly inspected by municipal officials during the construction process. There was also a home warranty in force.
However, the Frumers soon learned the home was compromised with a litany of problems and building code violations that threatened the structure of the home. What's more, the development of mold threatened the family's health. They moved out in 2009—first into an extended-stay hotel, then later into a smaller home they purchased.
After discovering the contractor who had built the home was "defunct," the Frumers turned to the home warranty insurance company. But 2-10 Home Buyers Warranty Corp. of Denver allegedly brought them little solace.
While Michelle, Alon and their two young children initially confined themselves to a large bedroom upstairs, their home warranty insurance company brought in a contractor who ripped the house apart, indeed finding a litany of serious issues.
Eventually, after the Frumers moved out, 2-10 Home Buyers Warranty Corp. directed its contractors to halt work on the home. Inspectors called in by the Department of Community Affairs of New Jersey found no fewer than 13 building code violations, including missing support columns.
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The family has launched a Home Warranty Lawsuit, alleging bad faith insurance against 2-10 Home Buyers Warranty Corp. The plaintiffs feel they should be compensated for the original value of the home at the time of their purchase. They have also sued the architect, the builder and the contractor whom 2-10 Home Buyers Warranty Corp. sent in to do the repairs. Alleging the home was not properly inspected during construction, the Frumers are also suing the City of Englewood, where the home is located.