Does a termite bond / insurance add value to your home at sale? (mortgage, loans) - Huntsville-Madison-Decatur area - Alabama (AL) - City-Data Forum

E Limestone Dude · 03-29-2010, 04:06 PM

When it comes time to sell my house in the near future, will having a termite bond make my home more valuable?

I'm contemplating cutting out the termite bond this year. It is $175/yr now and it came with my brand new house a few years ago. Just not sure if its worth it if nobody cares when they buy my house.

Seth Parker · 03-29-2010, 04:28 PM

Termite bonds can be a plus, but in all honesty, I've never seen a deal made or lost strictly because of whether or not there was one on the property. It comes down to this. If a buyer wants one, they'll get it on their own or ask you to buy the first year for them. Don't get me wrong, a bond is definitely worth the money, but I doubt not having one will affect the sale of it.

The buyer will be more concerned as to whether or not there is any evidence of previous/current infestation, but that will be found out when a termite letter is provided.

Dirt Grinder · 03-29-2010, 04:53 PM

I wouldn't buy a house without a valid "termite damage repair bond" as it is quite expensive to get one after the fact. Some sellers claim they have a "termite bond" but what they have is a guarantee from the issuer that the termite infestation will be eliminated - not that the resulting damage will be repaired at no cost to the owner.

E Limestone Dude · 03-29-2010, 05:29 PM

Quote:

Originally Posted by Dirt Grinder

I wouldn't buy a house without a valid "termite damage repair bond" as it is quite expensive to get one after the fact. Some sellers claim they have a "termite bond" but what they have is a guarantee from the issuer that the termite infestation will be eliminated - not that the resulting damage will be repaired at no cost to the owner.

This is what I have, and I think its quite expensive to start one from scratch. The problem is I don't think buyers will really value this add on enough for me to continue the expense.

I am just having a hard time justifying $175 for 'peace of mind'. I hate insurance.

LCTMadison · 03-29-2010, 06:16 PM

Actually, it really depends on the type of bond you have. There are some that just cover the cost of treatment of any infestations, but do not cover any damage to the property as a result of termites. These are basically useless in my opinion. If you have a repair/replacement bond, I would continue my service because those are quite costly to start up and they do have a good deal of value to buyers these days. A repair/replacement bond will cover all repairs required due to termite damage, and treatment of the infestation. We live in an area with a HUGE problem with termites. I would not look at it from a resale point of view, I would look at it as protecting your investment. Check and see what kind of bond you have.

Termites can do ALOT of damage, sometimes damage that cannot be readily seen. Bonds give peace of mind to homebuyers that, should damage occur, they are covered. I sold a few houses last year that had some pretty extensive termite damage but both sellers were covered with repair bonds, so all the damage was repaired satisfactorily and the buyers were happy since they had a bond conveying with the property.

Vera E Scott · 07-02-2010, 07:26 AM

company won't honor retreatment guarantee

leavin_florida · 07-02-2010, 07:41 AM

I would not go without termite bond in the south any more than I'd go without anti-freeze in a Montana winter. In Florida I had a termite bond, and sure enough when I sold my house the buyers inspector found some damage that the bond took care of. Here I happily write a $125 every year.

Southlander · 07-02-2010, 08:55 AM

The bank or mortgage company may require an active termite bond as a condition of financing.

LCTMadison · 07-02-2010, 11:43 AM

Lenders do not require termite bonds, but they will require a clean termite letter regardless of the type of loan. Even the most regulated of goverment loans (FHA, VA, USDA, ect) do not require termite bonds on the property.

cpg35223 · 07-02-2010, 11:54 AM

Quote:

Originally Posted by E Limestone Dude

When it comes time to sell my house in the near future, will having a termite bond make my home more valuable?

I'm contemplating cutting out the termite bond this year. It is $175/yr now and it came with my brand new house a few years ago. Just not sure if its worth it if nobody cares when they buy my house.

Penny wise and pound foolish. I would under no circumstance stop paying the termite bond on my house.