Frontdoor formerly 2 10 HBW letter to builder stating that adding the 2 10 HBW Warranty will limit consumer rights.
Virginia Consumer Virginia Consumer

Frontdoor formerly 2 10 HBW letter to builder stating that adding the 2 10 HBW Warranty will limit consumer rights.

2-10 HOME BUYERS WARRANTY.

Dear Builder:

Attached to this letter is an “Addendum to Purchase Contract” which has been prepared by legal counsel to integrate your purchase contract with the HBW Warranty provided to your homeowner.

The purpose of this Addendum is to incorporate the “all disputes” arbitration agreement in your purchase contract at the time that contract is signed. This arbitration agreement is intended to permit you to force any lawsuit by the purchaser into a binding arbitration proceeding. The arbitration agreement is governed by the Federal Arbitration Act (9 U.S.C. §§ 1-16), which mandates its enforcement and which preempts all state anti-arbitration laws. The United States Supreme Court has upheld the arbitration agreement under the Federal Arbitration Act. Lopez v. Home Buyers Warranty Corp. (1995) 513 U.S. 1123.

The provision regarding “Exclusive Remedy Agreement” is intended to limit the initial homeowner’s recovery after the first year of ownership. The provision contains a waiver by the purchaser of any common law warranties, as well as any claims for negligence or strict liability. However, the enforceability of this agreement is governed by the state and not federal law, so the extent to which it will be enforceable depends upon the laws of your state.

The provisions of the addendum supersede any contrary provisions contained in your purchase contract, and the HBW Warranty, when issued, will become a part of that contract. This Addendum was drafted assuming no further modifications to the purchase contract were needed. However, conflicting warranties and inconsistent dispute resolution provisions in your purchase contract should be avoided. In addition, state statutory requirements for waiving implied warranty obligations should be followed.

In order to make this Addendum and the HBW Warranty part of your purchase contract, you should:

(1) Furnish the purchasers with a sample copy of the HBW Warranty before they sign your purchase contract. You should encourage the purchasers to read the Warranty before they sign your purchase contract.

(2) Have the purchasers sign and date the attached Addendum, then attach it, with your signature, to your purchase contract as the last page.

(3) Keep a copy of the Addendum for your records when you close escrow.

Should you have any questions, please feel free to contact your local HBW Risk Management Specialist.

Very Truly Yours,

[Signature: Alison Short]

Alison Short

Executive Vice President

Corporate Support Division

2-10 Home Buyers Warranty

Rev. 02-10

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