Has your home warranty expired? No, it's a scam.

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Home warranty scams are hitting mailboxes nationwide

You open an official-looking letter envelope with the word “urgent” printed in bold letters. The letter inside informs you that your home warranty has expired and urges you to renew it immediately.

But that’s odd, you don’t remember having a home warranty. It’s an old trick, used by hucksters pushing both home and auto warranties. Lately, this scam has been hitting homeowners’ mailboxes from coast to coast.

With rising costs for home and auto repairs, there are many good reasons to have one of these extended warranty/service contracts. However, consumers should always be sure they are obtaining one from a reputable source.

Red flags

In addition to the “your warranty has expired” gambit, here are some other tell-tale signs the warranty offer is a scam:

  • The name of the company is fake: In one of these scams showing up recently in Texas, the offer is made by the “Home Warranty Division.” If you Google that name, followed by the word “scam,” you’ll find several news stories, and even a warning from the Maryland Attorney General’s Office, about this home warranty scheme.

  • The letter says your mortgage company has recommended the warranty: This is a common ploy but consumer protection officials in several states. The Oregon Attorney General’s Office says the letter may imply an affiliation with the homeowner’s mortgage company and the “county deed records” office. The individuals responsible for these letters are in no way affiliated with the homeowner’s mortgage company or the Register of Deeds office.

  • Vague contract terms: What exactly is covered and what isn’t?

  • The company isn’t registered in your state.

  • There are no reviews or nothing but bad reviews.

Do you need a home warranty?

Home warranty plans cover home appliances and systems. The specific coverage and types of plans differ between providers. However, you can expect most plans to cover major appliances, such as refrigerators and HVAC units, which can cost thousands of dollars to replace.

If you have an older home or a home with older appliances, a home warranty may be worth considering. Some plans will provide replacement appliances if an older appliance can’t be repaired. 

ConsumerAffairs researchers compared 26 home warranty companies and analyzed more than 200,000 consumer reviews before picking the nine best. That guide is a good place to start your research.

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