Incentive Warranties for LGBT Home Sellers

When it is time to sell their home LGBT homeowners should take a serious look at home warranties. These can act as a marketing incentive to encourage buyers while also covering the seller’s financial exposure in case of unexpected contingencies that would otherwise result in costly repairs. For that reason home warranties can be regarded as innovative sales incentives or unique marketing tools that also offer insurance coverage perks. Every LGBT seller in this somewhat tough economy needs as many of those as possible to help facilitate a timely and smooth sales transaction at the best possible price.

What is a Home Warranty?

Home warranties are basically specialized types of insurance policies that cover mechanical components and systems of the home for a relatively short period of time. They are somewhat like the extended warranties offered to consumers in retail stores when they buy such things are electronic gadgets and computers. But there is one significant difference between the standard home warranty and a typical extended consumer product warranty. The extended warranties sold by retailers are, according to most experts, not worth the money they cost – whereas many home warranties represent a valuable bargain that can help promote the sale of a home.

Almost all consumer products come with built-in warranties, and if the item has a factory flaw it will likely reveal itself almost immediately so that the customer can just return it for a replacement or refund. Buying an extended warranty often tacks 15 percent or more on to the purchase price of the item and is usually not a good idea because it represents redundant coverage that the customer will never need if the product is worth its salt. Plus these warranties have restrictive terms and conditions regarding what will automatically void the coverage.

Home warranties, on the other hand, are a horse of a different color. They generally cost around $300-$500, depending upon what is covered and the size of the home. That price represents a fraction of the cost to do most important emergency home repairs.

Buyer and Seller Benefits

More importantly, home warranties also add confidence that the home will be free of trouble – or that at least if there are unforeseen problems those will be covered so the buyer does not have to pay anything out of pocket. That extra bit of reassurance – especially during an economic time when buyers are hypersensitive about move-in expenses – can provide marketing leverage that gives the LGBT home seller a distinct competitive advantage.

Plus if the warranty is in place during the listing period it will cover many unexpected issues that might arise before closing. Those kinds of problems often torpedo sales transactions and make buyers look elsewhere unless the seller comes up with fast cash and gets the repair work done pronto. But under most good home warranties the repairs will be done by licensed and certified professionals in a timely manner – at no cost to the buyer or the home seller.

So having a home warranty in place, whether or not it is ever necessary to file a claim, generally offers an excellent return on investment.

How Do They Work?

Home warranty premiums are paid in advance, the coverage lasts from a few months to a year or more depending on the policy, and many of them are renewable and transferable. A homeowner can get one to cover the period of time their home is on the market, for example, and then transfer the remaining warranty to the buyer.

Warranties can be purchased for special components of the home – such as specific roof warranties – but most LGBT sellers will be served just fine by a general home warranty. These typically cover dishwashers, garbage disposals, HVAC systems and ductwork, electrical systems, ceiling fans, water heaters, telephone wiring, and most plumbing problems. Some also cover clothes washers and driers, stoves, and refrigerators.

But it is important that the homeowner carefully study the small print in the policy – just as one should with any kind of insurance document – to make sure they know what is covered and exactly what events or parts of the home might not be eligible for insurance claims. Homeowners will be expected to do routine maintenance such as cleaning filters on the air conditioner, for example, and to follow all applicable building codes. Warranties usually do not cover anything outside the home – like landscaping lights or sprinkler systems – and they probably won’t cover extraordinary features like outdoor kitchens, swimming pools, or hot tubs.

Many Realtors have experience with home warranty companies, because real estate brokers often purchase these policies for their own listings – especially when they are marketing an older home or a foreclosure property. LGBT homeowners who want to consider their home warranty options should ask their listing agent for recommendations and then choose a policy that offers the most coverage at the best price.

Connect with real estate professionals devoted to serving the LGBT community by visiting www.GayRealEstate.com, the world’s largest online network of LGBT Realtors. Or just call toll free 1-888-420-MOVE (6683).