Most homeowners should renew one-year warranty policy

About three-quarters of all home sales today include a homeowner's warranty policy. They can protect sellers and buyers alike against surprises.

Q. We purchased our first home last spring, and the sellers paid for a homeowners-warranty policy that promised to reimburse us for a lot of things that could go wrong in the first year of our ownership. The company that issued the policy paid for a new dishwasher when our old one broke down in September, but now it has sent us an invoice for $395 if we want to renew the policy for another year. Should we pay to renew, or should we cancel?A. About 75 percent of all home-sale transactions today involve a one-year homeowners-warranty policy. The typical policy can cover the cost of fixing an array of problems that might occur in the first 365 days after the deal is closed - from a dishwasher or other built-in appliance that quickly breaks down, to a heating or cooling system that dies a few days before the warranty expires.Many sellers today offer to pay for the first year of a buyer's warranty policy to improve their marketing efforts. Providing the coverage can even help them avoid a lawsuit if something goes wrong soon after the buyer moves in.Some real estate agents say buyers shouldn't bother to renew their warranty policies after living in their home for a year, explaining that most problems likely will be discovered in the first 12 months of ownership. But I think newer homeowners always should renew for at least one additional year, because the annual premiums are relatively affordable for the extensive coverage that they provide for the second or third year that they own the house.I own a small rental property that's about 20 miles from my home, and have always been able to deduct the cost of driving to and from the rental to make repairs or to pick up a tenant's check on my income-tax return as a business expense. I recently heard a radio report that said such deductions are being eliminated this year, which would cost me and other small-time landlords a whole lot of money! Was this report correct?A. No, the report you heard on the radio was not accurate. Landlords still can deduct the cost of visiting their property during the 2010 tax year, although the write-offs won't be as generous as they were in 2009.This year's standard mileage rate has been set by the Internal Revenue Service at 50 cents. That's down a nickel from last year, when fuel prices were higher. The deduction for qualified moving expenses (as well as medical-related travel costs) is 16.5-cents per mile. The 2009 rate was 24 cents per mile.We are planning to sell our home. Most of the agents we have interviewed would charge us a 6 percent commission, but one agent says he would charge only 5 percent - provided that we agree to let him market the property "in house" instead of putting it on the Multiple Listing Service. Our home should sell for about $160,000, so getting a 1 percent discount on the commission would save us about $1,600. Is this type of offer legal? Should we accept it?A. So-called in-house or "pocket listings" are legal, but they usually don't work out very well for a seller.The Multiple Listing Service, or MLS, is the backbone of the local real estate market. It includes the offering price and other details about nearly every home that is available, and is viewed religiously by agents who represent buyers. Putting your home on the MLS will help ensure it gets maximum exposure, which in turn will increase the chance that you'll make a quick sale at the best possible price.You will get only a fraction of that all-important exposure if you agree to let the agent keep the home off the MLS and market it only through his own office. It might reduce the commission you have to pay by $1,600 or so, but the fact that far fewer buyers will know that the property is for sale could very well mean that it will take longer to obtain an offer and that the eventual sale price will be several more thousands of dollars below what you would receive by putting the house on the Multiple Listing Service for all to see.bull; For the booklet "Straight Talk About Living Trusts," send $4 and a self-addressed, stamped envelope to David Myers/Trust, P.O. Box 2960, Culver City, CA 90231-2960.