Commerce Department warns about home warranty scams

Minnesotans are being warned about a scam that relies on bogus warnings about home warranties.

The Department of Commerce says homeowners in Minnesota and several other states have gotten letters in recent months, urging them to purchase warranties. The scam falsely implies a relationship with the homeowners’ mortgage company, or with the county deeds offices.

The DOC says letters can carry company names like, Home Warranty Direct, or Home Warranty Solutions. The scams suggest your warranty may be expiring, or have already expired, even if you have never had a warranty. The DOC says the letters appear to be official documents, but are simply fraudulent attempts to collect credit card or banking information, likely by criminals outside the United States.

Promotions that use threatening language or unnecessary urgency are almost always fraudulent. In this case, the scam letters use bold type and exclamation points and urge recipients to respond immediately or risk financial liability. To appear legitimate, they also cite names of specific mortgage lenders or servicers; information that is often public record and available online.

The Department of Commerce encourages Minnesota homeowners who are interested in purchasing a home warranty with a legitimate company to do research. “We recommend asking for referrals, checking the warranty company’s website and understanding the coverage you need and possible warranty exclusions,” said Jacqueline Olson, Commerce’s Assistant Commissioner for Enforcement. “If you receive an unsolicited offer, definitely don’t give out your credit card or bank account information until you’re sure the offer is legitimate.”

If you receive a letter from Home Warranty Direct or Home Warranty Solutions and wish to file a complaint, contact the Department of Commerce at or 651-539-1600 or 800-657-3602. Otherwise the letters can simply be discarded.