Home Warranties are more than just peace of mind

BrokerIPTV: Today, we are talking with Pat DeFeo, the Vice President of Colorado Home Warranty and Pat, welcome to the show.

Pat DeFeo: Thank you.

BrokerIPTV: Thanks for being here. For those people not familiar with your business, again, lets tell people what Colorado Home Warranty does.

Pat DeFeo: Colorado Home Warranty is a locally based and owned and operated company. We provide home warranties to homeowners in Colorado.

BrokerIPTV: Okay and a seller, someone selling a home, can purchase a home warranty, which may entice a buyer to buy their home because they have a warranty after they buy it or a buyer can buy home warranty plan after they purchase a house?

Pat DeFeo: Correct.

BrokerIPTV: Pretty much.

Pat DeFeo: A seller does not have to pay for it. The seller can apply, put an application in, and his home is covered until its sold.

BrokerIPTV: Wow! I didn't know that.

Pat DeFeo: And if its not sold, then there is no funds collected even if there had been service during the listing period.

BrokerIPTV: And real quick, how does the warranty program work? In other words, somebody finds something wrong with the house, you put in a claim, so forth,

Pat DeFeo: They put in a claim they call... they call our office, they will get a, my service department will take the call. We dispatch a technician depending on what it is and there is a $55.00 co-pay that is paid to the contractor when he gets there and they will fix the problem, whatever it is or they will replace the problem if we cant fix it; if its a dishwasher and it cant be fixed, then we replace it.

BrokerIPTV: Question for you, does business fluctuate or does your business fluctuate with the real estate market? If the real estate market is slowing down, is your business slowing down or it really doesn't matter?

Pat DeFeo: Somewhat, it does somewhat slow, slow down. We are, you know, I mean I hate to even say this, but we are like the low hanging fruit on the tree. I mean home transactions require mortgage, they require title, but they don't require,

BrokerIPTV: A Home warranty.

Pat DeFeo: Home warranty, but our business hasn't dropped as much as I thought it would during this ebb and flow that we are going through right now. So, I guess the answer to your question is we do fluctuate some with the market, but not as much this time.

BrokerIPTV: Which then brings me to my next question about which segment really purchases home warranties the most; is it this crowd that's 300,000 and below or is it really just the people who have million dollar homes and over?

Pat DeFeo: You know it doesn't segment... it doesn't segment at all. I mean I have, we have a requirement and all warranty companies have that, not a requirement, but we ask the buyer, when a warranty is placed, we ask how many square feet is it. The only reason we ask that is because usually if the house is over 5000 square feet, it will have duplicate systems. It will have two furnaces or two water heaters and that's just to protect the, the person that's getting the warranty. At that point, if they don't want to cover the extra system, we will tell them, we will cover the first one that breaks you know and we wont cover the second one. So, there are million dollar houses with two or three systems and we get those too quite frequently.

BrokerIPTV: Yeah, okay, but affordability, if I have got a small house and I live in Aurora and I am thinking there is just no way I am going to be able to afford a home warranty plan; its far more affordable than people think, is that right?

Pat DeFeo: Its very much affordable. If you are the buyer, and we have this special going and we have had it going for quite a while; if you are the buyer and its not covered during the listing period, its $250. So, that's like $12, a little over $12 a month and what that saves you is peace of mind. It gives you so much peace of mind because if something breaks and you don't have a warranty and you call another contractor, they can tell you any number of things is wrong. If you call, have a home warranty and the contractor goes out, they are not going to gouge you at all.

BrokerIPTV: Pat, great information. Thanks for being with us.

Pat DeFeo: Thank you.

BrokerIPTV: I appreciate it.

Posted on January 16, 2009 09:47:15 by Blog Author