$12.5B
FTC-reported fraud losses in 2024
FTC says consumers reported losing $12.5 billion to fraud in 2024.
home warranty scam
A telemarketer sells a home warranty that charges premiums but routinely denies claims, has extensive hidden exclusions, or disappears when service is needed.
“insurance scam”
↑ 100%Key indicators
Usually targetsHomeowners
Often hitsReal estate professionals and homebuyers
Common regionUnited States
Last updated2026-04-04
Estimated impact
$960
median reported loss
Typical range$60 – $6.0K
Recovery rate~15%
Scam breakdown
1
Telemarketers use public property records to target homeowners with expiring or nonexistent warranty claims.
2
The buyer pays a premium for comprehensive home coverage.
3
Claims are denied under fine-print exclusions, or the company stops answering calls.
What to do first
Research the company's complaint history on the BBB and your state attorney general's website.
Related terms
fake home warrantyhome protection scamappliance warranty scamInsurance scamsPhoneRisingHomeownersNew home buyersOlder adultsReal estate professionals and homebuyersRetirees and seniorsImmigrants and visa holdersUnited Statesfake home warrantyhome protection scam
Real-world example
How this scam plays out in practice
Based on reported patterns. Names and details are illustrative.
The setup
Robert, 42, a homeowners, encountered what appeared to be a legitimate insurance scams situation while using Phone. Telemarketers use public property records to target homeowners with expiring or nonexistent warranty claims.
Step 2
What happened next was calculated: The buyer pays a premium for comprehensive home coverage.
Step 3
The pressure escalated quickly: Claims are denied under fine-print exclusions, or the company stops answering calls.
The outcome
Robert realized something was wrong when unsolicited call claiming your home warranty is expiring — even if you never had one. By that point, significant damage had already been done — money sent, personal information shared, or trust exploited.
The lesson
Research the company's complaint history on the BBB and your state attorney general's website. Robert's experience shows why unsolicited call claiming your home warranty is expiring — even if you never had one and no physical address or state license information on the company's website are the clearest early warning signs.
How to identify it
- Unsolicited call claiming your home warranty is expiring — even if you never had one
- No physical address or state license information on the company's website
- Warranty contract has broad exclusion clauses that cover almost every common repair
- Pause before paying, clicking, or sharing information. Scammers rely on speed.
- Verify the sender, company, or agency using a phone number or website you already know is legitimate.
- Treat secrecy, urgency, and off-platform payment requests as strong scam signals.
What to do now
- ✓Research the company's complaint history on the BBB and your state attorney general's website.
- ✓Read the full contract — especially the exclusions section — before paying.
- ✓Report deceptive home warranty companies to the FTC.
What to save before reporting
- ✓Save the message, profile, phone number, email, or URL that was used.
- ✓Keep payment confirmations, receipts, and account alerts before you dispute or delete anything.
- ✓Write down the timeline while the details are still fresh.
- ✓Save the full chat or call log before blocking the sender so the reporting path still has the original context.
How big is this problem
You are not alone — this scam affects millions of people.
These numbers come from government agencies and official reports. If you have been affected, know that this is a widespread problem — not something that only happens to careless people.
FTC 2024 fraud losses
Imposters
Most common FTC fraud category in 2024
FTC says imposter scams remained the most commonly reported fraud category in 2024.
History and evolution
- This scam family tends to persist because the social-engineering pressure works even when the exact scripts, platforms, and payment methods change.
- The specific packaging evolves over time, but the core pattern usually stays the same: create urgency, control the channel, and push action before verification.
- Home warranty complaints are among the top categories on the BBB Scam Tracker.
Recovery and follow-up
- ✓Save the messages, receipts, account alerts, and transaction details before you block or delete anything.
- ✓Report the scam through the official platform or government channel that best matches where it happened.
- ✓Tell close contacts if a phone or text scam used your identity, so scammers cannot reuse the same story against people around you.
- ✓Research the company's complaint history on the BBB and your state attorney general's website.
- ✓Read the full contract — especially the exclusions section — before paying.
Why this pattern keeps working
Even when the story changes, most scams still use the same pressure pattern: urgency, authority, and a request to move money or data fast.
Home warranty complaints are among the top categories on the BBB Scam Tracker.
BBB Scam Tracker 2025
Where to report it
If you have been targeted by this scam, reporting it helps authorities track the pattern and protect others. United States has dedicated agencies that handle fraud reports.
ReportFraud.gov
Federal Trade Commission
Central U.S. consumer fraud reporting portal.
File an IC3 complaint
FBI Internet Crime Complaint Center
FBI portal for internet-enabled crime reports.
Start identity theft recovery
IdentityTheft.gov
Official U.S. identity theft recovery plan builder.
Explore further
Understand the bigger picture
Who is most at risk
Who this scam targets
Primary targets
Homeowners, New home buyers, Older adults
Geographic concentration
United States
Primary channel
Phone — Insurance scams
Why this group is vulnerable
Homeowners are particularly vulnerable because this scam exploits trust in familiar brands, authority figures, and time-sensitive decisions. The growing number of reports suggests that awareness among this demographic remains low.
Sources and methodology
How we verify this information
OpenScam tracks scam patterns using a combination of government consumer protection databases (FTC, IC3, Action Fraud), platform-specific fraud reports, and verified consumer complaint data. Each entry is cross-referenced against at least two independent sources before publication.
Severity ratings are based on financial impact potential, reversibility of damage, and volume of reports across multiple reporting channels. Trend velocity reflects the rate of change in report volume over the most recent 90-day window.
This page was last verified on 2026-04-04. Red flags, recovery steps, and reporting resources are reviewed quarterly against current agency guidance.
Evidence and indicators
- Home warranty complaints are among the top categories on the BBB Scam Tracker.
Source notes
- BBB Scam Tracker 2025
Frequently asked questions
Common questions about home warranty scam
How does the home warranty scam work?+
Telemarketers use public property records to target homeowners with expiring or nonexistent warranty claims. The buyer pays a premium for comprehensive home coverage. Claims are denied under fine-print exclusions, or the company stops answering calls.
What are the warning signs of home warranty scam?+
Unsolicited call claiming your home warranty is expiring — even if you never had one No physical address or state license information on the company's website Warranty contract has broad exclusion clauses that cover almost every common repair
What should I do if I encounter home warranty scam?+
Research the company's complaint history on the BBB and your state attorney general's website. Read the full contract — especially the exclusions section — before paying. Report deceptive home warranty companies to the FTC.
Who is most at risk for home warranty scam?+
This scam primarily targets Homeowners, New home buyers, Older adults. It is most commonly reported in United States and typically appears on Phone.
Is home warranty scam on the rise?+
home warranty scam is currently on the rise with growing reports. It has been reported across US. Last updated 2026-04-04.
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Help someone avoid this scam.
Scammers succeed because people do not talk about it. If you or someone you know has been affected, there is no shame in it — it happens to millions of people every year. Share this page with friends and family so they know what to look for.