We Recommend You Take The Home Warranty

If you are working with a real estate professional chances are they have brought up the topic of a home warranty. Whether you are on the buy side or the sell side we here at The Colorado Dream House Team are always encouraging our clients to take the home warranty. Not because we are trying to cost you money or it’s something we are mandated to do, but because we are trying to do the opposite. We find often the home warranty saves our clients’ money and can save someone from litigation. Here are the various ways it benefits you in the real estate transaction.


When we first we agree to work together and list your home we’ll often suggest we offer buyers a home warranty when they purchase your property. If you agree this is put in our listing agreement and then we actually put the home warranty in place when you sign the listing agreement. This is what we call seller’s coverage and works like an insurance policy covering the seller if anything goes wrong in the house during the period the home is on the market. Let say the house is on the market, you have showings, but one day the fridge goes out. You the seller can call in a claim to the warranty company. The company will charge you a deductible (usually between $50-$100) to send out a repairman. Once the repairman is on site he’ll first attempt to repair it. If it cannot be repaired, he will recommend the unit be replaced to the warranty company. If the warranty company agrees the seller gets a new fridge. This type of coverage during the list period of your home could save you thousands of dollars. In some cases, this could also help address some inspections items found while the seller is under contract with a buyer. Remember the seller does not pay for the home warranty (around $400-$600) unless the home goes to closing. So, you get all the coverage and protection from the warranty during the listing period for free (unless you pay a deductible for a claim). In most cases, the cost of the home warranty is shown as a line item expense on the final settlement statement at closing so there is no money out of your pocket.


When we are representing a buyer and we are writing an offer for that buyer many times we will write in additional provisions of the contract asking for the seller to pay for a one-year home warranty. Let’s say the seller agrees the buyer gets one year of coverage on critical items throughout that may break down after closing. For example, let’s say the furnace is 12 years old and the buyer is concerned it’s coming to the end of its useful life. The furnace is working at the time of inspection the buyer is just unsure how long it will continue to work after closing. The home warranty will ensure the furnace works for at least one year or the warranty will repair/replace it. We believe this is a must-have for anyone buying a home.

None of Them Are Perfect

As with all home warranties, none of them are perfect. They all have conditions, terms, cap limits, and flaws. Some are better than others and most will not cover pre-existing conditions. To know exactly which home warranty plans are better than other make sure you are working with a real estate professional like us the Colorado Dream House Team. If you have more questions about this or other real estate related information, you can reach us at 720-446-6325 or team@coloradodreamhouse.com.

Dan Polimino is a Broker/Owner of The Colorado Dream House Team, Keller Williams Realty DTC. Contact the Colorado Dream House Team at 720-446-6325, team@coloradodreamhouse.com, or coloradodreamhouse.com