Can offering a home warranty fast track the sale of your home? The answer is maybe.
Some buyers see a huge value in the seller offering a home protection plan at close of escrow. It’s a great way to interest buyers in your property — and potentially get you a faster sale. Don’t confuse a home warranty plan with your standard homeowner’s insurance. Typically homeowners insurance covers the structure only; home warranties will cover most of the things inside the walls.
Home warranties provide potential buyers with peace of mind
Home buying is stressful, especially for first-time buyers, who may have little experience with the unexpected maintenance surprises that are part of home-ownership.
Although the home inspection usually points out major structural damage, problems with the roof, and other issues that can be negotiated during the sale process, inspectors cannot predict with certainty when appliances or home systems will break down. That is where the home warranties will benefit the buyers. It can protect home-buyers from costly repairs, and replacements involving major appliances, heating and cooling systems, plumbing, electrical and many other items.
Be sure when purchasing a home protection plan that you select all the options that will protect you and your home.
Another benefit to your buyers (and you): A warranty can mean that buyers won’t need to set aside as much money for emergency repairs, and may have more funds available for the purchase. The reassurance of the warranty, along with a competitive home sales price that you work with your Realtor to set, could help fast track your sale.
How much do home warranties cost?
You can expect to pay anywhere from $375 to $600 depending on coverage, if you have a well and septic or a swimming pool the fee for the home protection will be over $500. There is also a service fee that will be charged to the homeowner, typically $60 in our area.
A warranty covers the homeowner for one full year from close of escrow. This can be renewed annually for your protection. If you are a current homeowner and do not have a home warranty, you can still purchase one at any time.
How will the buyer use the warranty?
1. If a covered appliance or system breaks, the homeowner calls the warranty company, which calls a service provider in the company’s network.
2. The provider sets up an appointment with the homeowner. If the appliance can’t be repaired, depending on coverage, the warranty company will pay to replace the unit.
Eileen Schamber is the president of the Lodi Association of Realtors and can be reached at firstname.lastname@example.org.