A transaction will include a home warranty. The seller's agent should determine which party will be responsible for the one-time premium.

• A. The buyer
• B. The mortgage lender
• C. The seller
• D. The title company

Answer: (C)

The key idea here is that who pays for a home warranty premium is a closing-cost allocation that is negotiated as a seller concession. Because it’s often used to make a deal more attractive to the buyer, the seller’s agent normally determines which party will cover that one-time premium and records it in the contract as part of the concessions. The premium is paid at closing and is not an automatic obligation of the lender or the title company, though they can be involved in the closing process. While the buyer could be the payer if negotiated, listing the seller as the payer is the typical and most straightforward approach to facilitate the sale.