Do I Need a Termite Bond?

By
Mortgage and Lending with Investment Properties

If you’ve researched termite control before, chances are you’ve come across termite bonds. So, what are termite bonds? What are they used for? How much do they cost? And even more importantly, do I need a termite bond?

Do I Need a Termite Bond?

In this article, we’ll discuss termite bonds and what they’re used for. We’ll also look into who provides termite bonds and when does one need one.

What is a Termite Bond?

In short, a termite bond is a warranty between a termite company and the owner of a home/property. It’s somewhat like a maintenance contract and typically includes two critical parts:

An agreement to inspect for termites for the entire length of the contract (usually several years). Inspections usually happen quarterly, annually or on an agreed-upon schedule.

An agreement to treat as well as control termites if they’re discovered. The owner doesn’t have to pay extra as the services are usually covered by a bond.

Retreatment only or repair of damages. An agreement should specify whether the service provider will retreat the structure without repairing damages or retreat and repair any damage from a subsequent infestation. However, it’s advisable to ask about eligibility and costs involved.

What Are They Used For?

A termite bond gives you peace of mind. If you have a termite infestation, you may be worried that termites will return, or may be unaware of the signs of termites. But with a bond, you’re guaranteed your pest control company will keep an eye on your premises and ensure a new infestation doesn’t catch you by surprise.

Termites also have a huge role to play when buying and selling a home. If an inspection points out a termite problem or likelihood of termites, the owners may have to take out a termite bond to attract buyers. Similarly, lenders may be unwilling to provide a mortgage for a home that’s at risk of a termite infestation without a bond.

Termite bonds can only be issued by certified pest control companies.

When Do I Need One?

If you recently discovered your home is infested by termites and are worried about it returning or planning to put your home on the market, plan for a bond. You don’t have to wait for a home inspection to determine whether you need a termite bond or not. Since termites can eat wood relatively quickly, it’s important to have this bond in place so that they don’t cause irreparable damage. In the case where you see that there are signs of termites in your home, you can contact a professional to get rid of them or create your own home remedy to get them out of your walls or furniture.

How Much Do They Cost?

Termite bond prices depend on various factors such as the services included, how duration of the bond and other factors. You can expect to pay between $700 and $1000 for the initial service, but the prices can be lower for simpler arrangements. Annual costs will typically run $300-$400 for the warranty coverage, which includes an annual inspection as needed.

Bottom Line

So, if you’re still asking yourself the question: Do I need a termite bond? The short answer is yes. This will keep your mind as ease in the case that you do have a termite infestation and notice the signs of them such as swarming. It also helps to note that termite bonds are either be transferred or not. If possible, get a transferable bond as it can be transferred to a new homeowner upon the sale of a home.

 

Comments (1)

Dan Hopper
Dan Hopper - Gold Way RE - Westminster, CO
Denver Broker / Real Estate Advocate

Great information, !  In the Denver area there are just a few spotty areas that have had "termites" found.  Mostly, it is too dry in Denver.  Since, we will be acquiring a few properties in the Tampa area, it might not be a bad idea to procure this type of protection, the Termite Bond.

Nov 26, 2019 10:53 AM