First let me say that I am a born skeptic, and I’m frugal. I NEVER buy the extended warranty when I buy a new appliance or other major purchase. In my mind I think that extended warranties are a scam and I would like to assume that the product that I am buying is well enough made that it should last for 3 years or so without me needing an expensive service call or a warranty to pay for the service call. So, for me to state that sellers should have a home warranty seems a bit hypocritical. Yet I always offer them to my seller clients (and buyers alike) especially with older homes. In my opinion, there really is no reason for a seller not to have a warranty. First of all, the warranty is free until closing. If its not negotiated in to the contract, you never pay for it. Second, the seller is covered for lots of things during the listing period, even without purchasing the warranty, and the all the seller pays is the deductible for the service call. Not bad, huh?

I don’t make any money by selling home warranties – I simply believe they are a good value and an excellent sales tool. Last year I had a listing in Milton. It was an older home and the sellers agreed to purchase the home warranty. It was the middle of summer and during the home inspection it was discovered there was a problem with the heating system. The sellers only paid the $75 deductable for the service call, all other repairs ($480.00) were covered by the warranty. Six months after closing the hot water heater went and the buyers got a brand new replacement for $75. Everyone was pretty happy on that deal.

The warranty can also help if there are negotiations after a home inspection. I’ve had many situations where the buyers have not made issues of minor problems because they knew they were covered by the warranty. I’ve also solved some inspection negotiations by suggesting the seller purchase a warranty for the buyer rather than providing financial concessions.

The verdict: a warranty warrants serious consideration.