What are Termite Bonds and should you buy one?

What is a termite bond?

A termite bond is a service agreement with a pest control company.

The services typically involve inspections, treatments, and in some instances, damage repairs.

The terms of the contract will vary depending on your situation.

But the ultimate goal is to protect your home from being insfested or re-infested.

If your house has been treated by a contractor, a termite bond guarantes that they will treat your home if the termites come back, for free.

Some will also obligate the pest control company to treat and repair any termite damage after the initial treatment.

What Are the Types of Termite Bonds?

There are two main types of termite bonds: re-treat and damage repair bonds.

Re-treat Bond

Re-treat bond is a guarantes that the company will treat your home if the termites come back, at no additional charge.

Damage Repair Bonds

This contract obligates the pest control company to repair any termite damage that may occur after the initial treatment.

The agreement does not apply to pre-existing damage.

It’s only valid if there’s proof that there are live termites present after the treatment.

If you discover new damage but cannot find live termites, it’s assumed that the damage was done before the initial treatment.

Like most insurance, damage repair bonds have a monetary limit. The exact value varies per contractor.

Why Do I Need a Termite Bond?

If your homeowner’s insurance policy doesn’t cover termite damage, termite bonds can be extremely beneficial.

Just like any insurance, termite bonds minimizes the possibility of additional expenses in the future.

It provides you with a certain number of termite inspections within a given period, so termites will not re-infest your home.

Termite bonds also guarantee that your contractor will treat your home if the termites come back, at no cost to you.

Some will also obligate the pest control company to treat and repair any termite damage after the initial treatment.

Having a termite bond protects you from losing money because of an ineffective treatment.

Who Should Get a Termite Bond?

Getting a termite bond is a great idea if:

1. Your homeowner’s insurance policy doesn’t cover termite damage, termite bonds can be extremely beneficial.

If your contractor fails to remove the infestation in your home, the termites can continue to do more damage.

Termite bonds obligate the pest control company to repair any termite damage that may occur after the initial treatment.

This guarantee protects you from losing money because of an ineffective treatment.

2. You are skeptical about pest control companies.

Since the bond guarantees that your contractor will treat your home if the termites come back for free, you wouldn’t have much to lose.

Plus, you’ll know that you are working with a reliable company if they are willing to give you a satisfaction guarantee.

3. You live in a high-risk area.

Termite bonds are also a considerable preventative measure if you live in humid regions.

These areas are particularly susceptible to termite infestations.

Having a bond will ensure that you get regular inspections to catch the first signs of termite infestations.

Here is a map of where termites are more common in the U.S:

termites-map

4. You have a severe infestation.

Treatments for large infestations are costly.

By having a termite bond, you are guaranteed only to pay that cost once.

Termite Bonds Pros and Cons

Pros

  • Keeps pest control companies accountable for ineffective treatments.
  • Minimizes the possibility of additional expenses in the future.
  • Less expensive than separate treatments
  • Can be helpful when selling your home

Cons

  • Expensive
  • You still pay even if termites don’t come back

How Much Does a Termite Bond Cost?

A termite bond is typically about $500 to $2,500.

The price varies depending on your region, the size of your home, frequency of inspections, and your coverage.

Termite bonds with more frequent inspections cost more than traditional termite bonds.

Also, those that cover damage repairs are more expensive.

In general, the simpler the arrangements, the cheaper the bond.

Termite bonds are also the most expensive in the first year after the treatment.

After the first year, the price drops significantly. The second-year termite bonds can be as low $200.

That’s because the first year has the highest risk of the termites coming back. The following years are more preventative.

Do I need a termite bond to sell my home?

No. You do not need a termite bond to sell your home.

There are no laws that require termite bonds to be presented to buyers before you sell your house to them.

That said, most lenders will refuse to lend money without a termite inspection report.

Banks generally do not want to invest money on a home that may be structurally compromised.

A termite bond will give lenders and buyers piece of mind that the property is free and safe from any termites.

What is a transferable termite bond?

A transferable bond means that the contract can be transferred to a new homeowner if it is sold.

The contrast is a non-transferable bond. As the name implies, a non-transferable bond means that you cannot transfer the contract to a new homeowner.

Is a termite bond a waste of money?

A termite bond can be a waste of money if:

  • You have never had termites.

If you have never termites then investing in a termite bond could be an excessive expense to take to prevent termites.

Often taking preventative measures around your home such as replacing rotten wood and eliminating sources of moisture is a more budget-friendly way to prevent termites.

A cheaper alternative is to get yearly inspection to catch the first signs of termite infestations.

The only exception to this is if you live in areas that are susceptible to termite infestation, such as Florida, California, and other coastal states.

  • Your home has been termite free for several years.

If several years have passed and you don’t have termites it is likely that the termites in the area have been eliminated.

Soil treatments last 5 years which means the barrier around your house is protected.

Likewise, bait systems typically last over 10 years if the bait is not consumed by termites.

These treatments are often enough especially if you have been termite free some time.

Also following preventative measures and doing your own inspections is typically sufficient.

Your infestation is small and can be eliminated with localized treatment.

  • Your home was treated during construction.

Homes treated during construction typically have a termite barrier around the home as well as inside the wood.

As a result, continuous inspections and treatments are often unnecessary.

  • You have a small localized infestation. 

If you have a small infestation you can likely get rid of termites with localized treatment. 

When treated properly localized treatments such as heat, injection, and liquid nitrogen are extremely effective at eliminating termites. 

What Is a wood-destroying organisms report?

A wood-destroying organism report informs a lender and buyer of any infestation and damage caused by wood-destroying organisms in a home.

A pest control operator makes this report to protect buyers and lending institutions from investing in a termite-infested property.

The report provides information about types of infestation, treatment history, current damage, and recommended treatments.

This report is a vital part of the process of buying a home.

The Department of Pesticide Regulation recommends that the home buyer get the Wood Infestation Report.

That’s because the buyer has the strongest interest in full disclosure of this information.

That said, if you are a homeowner, having a wood-destroying organism report before selling your home can help you expedite the sale.

What is a Termite Letter?

The termite letter is another name for a wood-destroying organisms report and termite inspection report.

It’s a document made by a Pest Control Operator about a home’s treatment history, current infestation, damage, and recommended treatments.

Buyers and lenders rely on the report to protect them from investing in a termite-infested property.

How Long is a termite letter valid?

Termite letter is typically valid between 30 and 90 days before closing.

The specific length of validity varies from state to state.

How much does a termite letter or Wood Destroying Organisms (WDO) Report Cost?

Termite inspections can range from $50 to $150.

Sometimes you can get it for free.

It’s not uncommon for a pest control company to offer a free inspection in hopes that there are termites and that you will need their service.

If you have paid for a termite bond, you can typically request this report at no additional charge.

Likewise, if you’ve had an annual inspection, you can request this letter for no additional cost.

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