Builders' Warranties

• Most home builders in Texas will offer some kind of warranty with a home; these are usually provided by private, third-party contractors. A warranty typically has a one-year warranty on workmanship and materials, a two-year warranty for electrical, plumbing and air-conditioning systems, and a 10-year warranty for major structural components. Builders can offer more extensive coverage such as two years on workmanship and materials and will likely use this as a selling point.
  
  

The Fine Print

• Warranties have exclusions; home owners should read all contracts before signing on the dotted line. There are many instances where a warranty is void. For example, cracks in a foundation might not be covered if they do not exceed a certain size or the home owner fails to keep soil moist around the house to avoid shifting land. A major structural defect -- covered for 10 years in most policies -- usually must affect a load-bearing wall and render the house unsafe to live in before the warranty will kick in.
  
  

Handling Disputes

• The Residential Construction Liability Act (RCLA) under the Texas Property Code gives a legal process for a home owner who has a dispute with a builder or contractor. The goal is to prevent costly litigation. The homeowner sends a certified letter to a builder explaining the defects. The builder can offer to make the repairs, come back with a counteroffer, or reject the home owner's claims. The RCLA doesn't cover normal wear and tear, non-maintenance by the home owner or normal shrinkage of construction materials due to drying or settlement. If the dispute is not settled, the home owner can then sue. A home owner can also file a complaint with the Texas Attorney General's office and the Better Business Bureau.
  
  

Demise of the TRCC

• Home builders in Texas do not need to be licensed and are not regulated by any state agency. Thus, the Texas Residential Construction Commission was formed in 2003 to provide home owners basic protection in the form of builders meeting minimum construction requirements and providing specific warranties. Inspections were also supplied to home owners who believed their new homes had defects due to shoddy construction. The commission's funding was not renewed by the state legislature and it closed Aug. 31, 2010.