Termite Bonds and Termite Letters
During the excitement of searching for a new home, the last thing on your mind is usually "what could go wrong with the internal structures of this house?"
Particularly for homes in the south of the United States, such as Georgia, a termite infestation or old termite damage can destroy a great potential home. Give yourself peace of mind by hiring a pest control company to examine a potential home during the home inspection phase and give you a termite letter. Then you can choose to receive a "termite bond" from the company for future protection from termites.
What Is a Termite Letter?
A termite letter can also be called a wood infestation inspection report or wood destroying organisms report. This letter reports on the status of termites in, under, and around the house.
After a professional performs the inspection, there will be one of two outcomes:
- They will declare the home termite-free and give you a termite letter; or
- They will treat the home for termites and you can decide whether to purchase a termite bond.
Some loans require a termite letter but not all counties require a letter to buy or sell a home. In some cases, you can request that the seller deals with the termites, though the cost of the termite letter is generally on the buyer.
You can expect to pay around $45 for the cost of the termite inspection and letter in cities that commonly use pest control services, such as Atlanta. The cost may be higher for homes located in humid places or near water.
What Is a Termite Bond?
A termite bond is essentially a contract between you and a termite control company that works like an insurance policy against termites. The terms can be set on a case-by-case basis and often include reimbursing you for repairing direct termite damage or covering future treatments.
When you are looking to buy or rent a home in a termite area, it is important to have a new termite bond or letter or to get access to a recent bond or letter. Any recent letter should be listed on the seller's disclosure. Some termite bonds can be transferred to the new homeowner, which is known as a transferable bond.
A termite bond is not always required to sell a home, so it may be up to you to decide if you want the inspection and bond completed. Generally, there will be an annual inspection as part of the bond to keep termite issues under control.
To create an accurate and useful termite bond, a termite company will look for:
- A need for termite retreatment
- Evidence of past termite control or damage
- New chemical termite treatments to complete
- Specific types of termites damaging the home (the bond may not cover all types)
- Evidence of subterranean termites
- Methods for termite prevention
They will also discuss whether you need a termite warranty on the house and future inspections. The typical termite bond cost varies on the amount of coverage you select. The cost of the bond does not cover inspections for bed bugs, ants, or beetles and other nuisances that could cause unforeseen additional costs in the future. It also does not cover damage that leads to termite infestations, such as water damage that allows the termites in. It only covers the actual killing and management of the termites, and damage that occurs directly from the termites.
My New Home Has Termites — Now What?
A termite inspection and the subsequent damage is not always covered in your homeowner's insurance policy. Regular termite checks can catch damage early and prevent larger problems, so finding damage usually indicates long-term neglect from the previous homeowner. That is why actions are generally taken against the seller and not through insurance.
You may be able to request a repair bond from the termite company or discuss legal action against the seller for not disclosing this information before selling the home. This is where an attorney knowledgeable about termite issues and damage repairs can help a new homeowner protect their right to buy a safe home.
A termite bond can be created when you purchase the home or during a termite inspection, so you may be able to get help for the termite infestation right when you discover it.
An Attorney Can Step in With Termite Bond Issues
A real estate attorney can help a new home buyer check all the right boxes when looking at a new home. They can ensure compliance during the inspection phase and start a case if issues with the home are not revealed until after the sale.