Profile picture for petelu

Credit instead of Home Warranty

Hi, my agent requested home warranty on the contract to be paid for by the seller and the seller agree. After my agent gave me the brochure to read about the home warranty, it seem like they don't coverage much and there are lots of restrictions. Can I just use the money as credit for the closing instead of buying a home warranty, do I need to inform the seller or it will automatic credit during the escrow process
  • March 31 2014 - Houston
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Answers (4)

Profile picture for Sharon Lewis
I also have a home warranty(had it for ten years) and it has paid for itself every year. 
 Things go wrong in a home (new or old), my recommendation to you is what Naima said, shop around for other home warranty companies if you don't like the one you and your agent chose or the sellers chose.
  • April 01 2014
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Before you go that route, explore other home warranties.  I tell you that mine has paid for itself every year.  Unless the home is brand new, or has had all the major components replaced, I wouldn't forego of the warranty.

There are many out there.

Naima
  • April 01 2014
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It is also in the seller's interest to provide you a home warranty.
You can discuss, but they may not agree.
You are correct in that there are a lot of restrictions.
Sometimes they're heroes sometimes they're villains.
You may be able to pay for it at closing, and then cancel in the future.
  • March 31 2014
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Profile picture for Owens Realty Group
Hi Pete, you will need to talk with the seller and inform your lender, and the title company about this. There will need to be some sort of an amendment. You cannot simply disregard ordering a home warranty and have the funds be applied toward your closing costs. Talk with your agent about this right away to have it addressed before you are too far along in your loan process because the extra amount of closing costs will require some redrawing of docs by the lender. Plus, the seller will need to agree to this. Best of luck to you and congrats on your purchase!
  • March 31 2014
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