1. The Good, the Bad, and the Ugly Maryann Azambuja, Choice Home Warranty

2. What is a home warranty?
Pays towards the repair or replacement of any covered appliance or home system that malfunctions under normal conditions of use.
A service contract that helps protect home owners against the cost of unexpected covered repairs of their major systems and appliances that break down due to normal wear and tear.
A one year service agreement that covers the repair or replacement of any major home system components and appliances that typically break down over time due to normal wear and tear.

3. What does a home warranty cover?
Think Peach
Plumbing
Electric
Appliances
Cooling
Heating

4. Why ask for one??

5. What a home warranty is NOT!
Does NOT cover for anything structural…only Mechanicals!
Cracked windows
Dips in Flooring
Secondary damage
NOT a builder’s Warranty
Does NOT cover foundation.

6. Home Warranty Trends. . .
Average usage across the country. . .
Average usage in the state. . .
Do you use warranties in your business?

7. Difference between home warranty and home Insurance…KNOW IT!
Home Warranty and Home Insurance do not cover the same things. Home Insurance covers damage from natural disasters, flooding, and burglaries. Home Warranties cover failed mechanical systems and appliances.

8. Who can get a home warranty?
Your Seller
Your Buyer
Any old home owner
Check the company you are using! Some offer it, some don’t.
Most of the time it’s FREE!!! HVAC is an additional $$. Make sure your clients know this!
Check time limit on coverage…180 days up to one year!
Limited during the listing period…MUST BE LISTED!
Is it RISK FREE for your seller? Some companies make you pay for it!
Most start on the date of closing with no waiting period. Make sure you are looking to see if coverage begins immediately!
Offered by some companies
Some increase in price…some don’t
Most times there is a 30 day waiting period—protects all parties!

9. WHO PAYS?
SELLER
BUYER
RE AGENT
TITLE COMPANY

10. ON YOUR PURCHASE AGREEMENT…HOW TO WRITE IT FOR HOME WARRANTY

11. WHAT DOES YOUR CLOSING DISCLOSURE (HUD) LOOK LIKE?

12. Benefits to the Seller
Marketing: Homes with a home warranty included sell on average 50% faster than homes without—National Home Warranty Association
Covered during listing period—you can be the hero! Also helps to win listings…FSBO’s cannot get a free warranty during listing period.
Avoid Post-Sale Disputes

13. When to offer to Seller. . .
Discuss need for disclosure of existing defects.
Property disclosure + home warranty = less after sale headaches!
Help with home inspection repairs
No fee paid if home does not sell!

14. Benefits to your Buyer Peace of mind
Helps toward the cost of untimely repairs
Don’t pay retail
Vendor provided with most home warranty companies

15. How are Contractors Hired?
Most hw companies hire low for more profit margin!
Uber dispatch system
Service fee paid if no services rendered
2nd opinions
Follow up surveys.

16. Cost Costs range from $370-$800.
Be careful with lesser amount…most of the time will exclude Fridge and W/D
Consider Add-on’s

17. Homes over 5000 square ft
Look at your contract or ask your rep. This is the industry standard for the cutoff and most companies will increase drastically over square feet!

18. How it works…
If something should break down, make sure your client knows to call the home warranty company first!!!
Vendor comes out
Trade Call Fee is paid
Vendor calls in diagnosis
Level of coverage is applied

20. Trade Call Fee Deductible
Check your brochure to see how much your clients will be paying!

22. Quiz
1.  True or False:  a home warranty is just like insurance. 
2.  True or False:  Pre-existing condition coverage is included in most home warranty companies. 
3. Home warranty will cover for which of the following:
​A.  Cracked windows 
​B.  Dips in flooring 
​C.   Roof replacement
​D.  None of the above 
4. What line of the purchase agreement is the home warranty on?  
5.  What does PEACH stand for?

23. BREAK-10 minutes
Jumping Jacks, Sit up’s, coffee…just don’t fall asleep

24. Part 2
Home Warranty broken down by Mechanical Systems

25. Do you need an inspection?
Most companies say no. However…if we ask for inspection to verify that things were in proper working order and your home owner doesn’t have one, it could open them up for a denial!!! #badnews

27. Components of every home warranty policy. . .
Limits of Liability. . .
What a warranty does and does not cover
How to Place a Claim
Dates of coverage
How to cancel a policy

28. Providing Service. . . Realistic Expectations
Must CALL warranty co FIRST!
Emergency Service
Warranty does NOT COVER EVERYTHING!

29. CFPB and Home Warranties. . .
In 2010 Hud says H.W. companies are a settlement service and are regulated by RESPA.
No “per transaction” Kick backs!
In 2014 the House of Representatives pass HR 24, says warranty companies ARE NOT a settlement service!
But yet to pass in Senate or be signed off on by President!
Most Lobbyist say HW will be settlement service indefinitely! So paying a kick back is ILLEGAL!

30. Benefits for AGENTS. . . Greater client confidence
Service notifications
E and O discounts!
Way to follow up with your clients. . .HAVE them call me for discounts and best service!

31. Open House Feedback forms Online marketing portal
Marketing tools. . .
Sign riders
Tent cards
Open House Feedback forms
Online marketing portal

32. Your Home Warranty Resource
Maryann Azambuja